Japan’s Nov factory output falls for third month

JAPANESE factories slashed output for a third consecutive month in November, dragged down by weak demand for machinery products amid a deteriorating global economic outlook.

The weak production bodes ill for Japanese firms as they face policymakers’ calls to raise workers’ pay to counter inflation, seen as essential for the post-pandemic growth of the world’s third-largest economy.

Factory output fell 0.1 per cent in November from the previous month, government data showed on Wednesday, slightly higher than the median market forecast for a 0.3 per cent drop.

That marked the third monthly decrease in Japanese production and followed a revised 3.2 per cent fall in October and 1.7 per cent contraction in September.

Output of general machinery slipped 7.9 per cent, while that of production machinery such as semiconductor-making equipment decreased 5.7 per cent, driving down the overall index in November.

Output of auto products was also down 0.8 per cent. The Ministry of Economy, Trade and Industry (METI) cut its assessment of industrial output for a second straight month, saying “production is weakening”.

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Manufacturers surveyed by METI expect output to gain 2.8 per cent in December and decrease 0.6 per cent in January, the data also showed.

Following a surprise contraction in July-September, economists expect Japan to grow an annualised 3.3 per cent in October December on robust domestic demand, the latest Reuters poll showed. REUTERS