Japan’s Industrial Output Falls for First Time in Six Months

Japan’s industrial production fell for the first time in six months in January, raising questions about the sustainability of Japan’s export-driven growth in the second half of 2016. Retail sales rose.

Key Points

  • Industrial production fell 0.8 percent in January from a month earlier (forecast +0.4 percent).
  • Output is forecast to rise 3.5 percent in February and drop 5 percent in March.
  • Retail sales rose 0.5 percent from a month ago (forecast +0.3 percent).

Big Picture

The unexpected weakness in industrial output points to the risk of depending on external demand for recent economic growth. While domestic consumption has been weak in Japan, net exports added to growth in the second half of 2016, and shipments rose in January for a second straight…

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