Japan’s industrial output re-energized in June

Japan’s factory output gained in strength after some weakness in May on account of an increase in the production of cars and industrial chemicals. This suggests that economic expansion may be on a more stable footing.
 
Japan’s industrial output surged by 1.6% in June compared to last month’s decline of 3.6%. The transport sector output was up 4.2% in June as against the fall of 13% in May due to recovery in the output of passenger cars and automobile engines.
 
The chemical sector output rose 3.4% in June, a rebound from a 2.2% decrease in May.
 
However, inventories across all industries dropped 2.2% in June as inventories of cars, steel and electronic equipment were reduced. This has been the biggest fall in more than six years.
 
Manufacturers surveyed by the industry ministry expect a steady increase in output to rise 0.8% in the current month and 3.6% in August, which indicates that gains in output are likely to be maintained.