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Japan: May industrial production increases less than announced

Industrial production in Japan rose 2.0% in May over one month, a result lower than the preliminary figure of 2.3% announced at the end of June. The decline reflects downward adjustments to the manufacture of alcoholic beverages, according to the Department of Industry.


Factory production, a volatile indicator, has been driven by the manufacturing of vehicles, electrical equipment, and telecommunications as well as by industrial machinery, the government said.


Japanese manufacturers, however, are worried about the risk of falling orders from China, a country whose industrial activity is hampered by US taxes on imports from China, as well as corporate blacklisting to cut off access to US technologies. Japan is a significant supplier of components and equipment for assembled products in China.


Therefore, Japan’s exports could suffer if they reached no agreement between Beijing and Washington. Discussions resumed after US President Donald Trump met with his Chinese counterpart Xi Jinping in late June in Japan on the sidelines of the G20 summit, but on Thursday Trump again accused China of not buying US farm products as Beijing was committed to it, words that are not auspicious.

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