‘Positive’ outlook for Japan as factory output hums
Tokyo, (MILLAT ONLINE):Japan’s factory output edged up in October, government data showed Thursday, adding to signs the world’s third-largest economy is on track to recovery.
Factory output rose 0.5 percent month-on-month in October, the industry ministry said, following a 1.0-percent drop in September.
The increase however was below market expectations of a 1.8-percent rise, as falls in the production of electronic devices and petroleum products offset gains in electrical machinery and transport equipment.
“The latest figure is weaker than expected, but considering other brisk data recently released — strong business sentiment in manufacturing and exports, among others — I think the country’s economic outlook is positive,” said Yoshiki Shinke, chief economist at Dai-ichi Life Research Institute.
Japan’s prospects have recently improved with investments linked to the Tokyo 2020 Olympics giving the economy a shot in the arm.
The economy grew by 0.3 percent in the third quarter of the year, notching up its seventh straight quarter of economic growth.
The growth in the July-September quarter marked the longest string of gains for more than 16 years, although the rate of expansion slowed.
However, wage hikes have been tepid and efforts to lift inflation have fallen flat despite years of aggressive monetary easing by Japan’s central bank.
In late October, the Bank of Japan cut its annual inflation forecast but kept its ultra-loose monetary policy unchanged, as prices remain far below its inflation target of two percent.