Market Commentary and Intraday News

Japan Industrial Output Dips 4.1% In September

231 days ago

(RTTNews) - Industrial output in Japan fell a seasonally adjusted 4.1 percent on month in September, the Ministry of Economy, Trade and Industry said in Tuesday's preliminary reading.

That missed expectations for a decline of 3.1 percent following the 1.6 percent decline in August.

On a yearly basis, industrial production plummeted 8.1 percent - also missing forecasts for a fall of 7.1 percent after shedding 4.6 percent in the previous month.

Upon the release of the data, the METI downgraded its assessment of industrial production, saying: "Industrial production is on a downward trend."

Before the downgrade, the METI had said industrial production appears to be weakened.

Industries that contributed to the decline in September include transport equipment, general machinery, and iron and steel. Commodities that contributed to the decline include passenger cars and control parts.

According to the survey of production forecast in manufacturing, production is expected to decrease 1.5 percent in October and increase 1.6 percent in November.

Industries that contribute to the fall in October include electronics equipment, iron and steel and other material. Industries that mark the increase in November include electronic parts, electrical machinery and chemicals.

Shipments were down 4.4 percent on month in September, reversing the gains in August. They were also down 8.5 percent on year, thanks to a decline in transport equipment, general machinery and electrical machinery.

Inventories were down 0.9 percent on month, falling for the second straight month. They were also down 4.8 percent on year thanks to electronics equipment, electronics parts and precision instruments.

The inventory ratio was up 4.2 percent on month in September, after falling in the previous month. It was also up 11.0 percent on year.

Also on Tuesday:
. The unemployment rate in Japan was a seasonally adjusted 4.2 percent in September, the Ministry of Internal Affairs and Communications said- in line with expectations and unchanged from the previous month. The participation rate was 59.3 percent, also matching expectations and easing from 59.4 percent in August.

The number of employed persons in September was 63.08 million, down 130,000 or 0.2 percent from the previous year. The number of unemployed persons in September was 2.75 million, down 20,000 or 0.7 percent from the previous year.

. Average household spending in Japan was down 0.9 percent on year in September, the Ministry of Internal Affairs and Communications said, standing at 266,705 yen. That was well shy of forecasts for an increase of 0.8 percent following the 1.8 percent gain in August.

The average of monthly income for workers' household was up 0.1 percent on year to 422,046 yen, while consumption expenditures added an annual 0.6 percent to 299,821 yen. Among the individual components, spending on education plummeted an annual 23.7 percent, while housing dropped 14.5 percent and fuel and recreation each shed 3.6 percent.

. Upon the release of the data, the Japanese yen dropped to four-day lows of 79.94 against the U.S. dollar, 103.28 against the euro, 85.48 against the Swiss franc and 65.63 against the New Zealand dollar following the data. The yen also reached session's lows of 128.20 against the pound, 79.91 against the Canadian dollar and 82.69 against the Australian dollar.

On the downside, the Japanese unit may find target levels at 80.30 against the greenback, 103.90 against the euro, 128.40 against the pound, 85.80 against the Swiss franc, 65.90 against the kiwi, 80.20 versus the loonie and 83.0 against the aussie.

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