A worker checks machinery at a factory in Higashiosaka, Japan June 23, 2022. REUTERS/Sakura Murakami
TOKYO -Japan’s factory output rose much less than expected in September, government data showed on Tuesday, as demand slowed significantly, adding to uncertainty hanging over the export-reliant economy’s outlook.
Industrial output rose 0.2 percent in September from the previous month, data from the Ministry of Economy, Trade and Industry (Meti) showed on Tuesday. The reading was worse than a median market forecast for a 2.5 percent gain and followed 0.7 percent drop in August.
Production machinery output fell 3.4 percent in September from the previous month, dragged by sluggish manufacturing of industrial robots and metals. Both domestic and overseas orders for those products were significantly lower, a Meti official said.
“Investment appetite has been declining due to the rising interest rates at home and abroad,” the official said.
Semiconductor manufacturing equipment output went up 13.2 percent month on month in September, but the official said output for chips and electronic devices is unlikely to recover any time soon.
However, autos production rose 6 percent after disruptions caused by a typhoon and system failures eased, the Meti official said.
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Japanese automakers reported strong domestic output for September, with Toyota Motor jumping 12.8 percent and Honda Motor climbing 24.2 percent year on year on Monday.
Manufacturers surveyed by the industry ministry expect seasonally adjusted output to rise 3.9 percent in October and fall 2.8 percent in November, sticking to its assessment on industrial output of “seesawing.”
“Demand for goods is expected to remain sluggish both domestically and overseas, and production is not in an environment for a major recovery,” said Kota Suzuki, economist at Daiwa Securities.
Separate data also showed Japanese retail sales rose 5.8 percent in September from a year earlier, marking a 19th straight month of gains and roughly in line with the median market forecast for a 5.9 percent increase.
Compared with the previous month, retail sales dipped 0.1 percent in September following 0.2 percent growth in August, the data showed.