Japanese industrial output in unexpected fall

Japanese industrial production slipped 0.1% in June, from the previous month, amid fears that economic weakness in Europe is threatening recovery.

Industrial production in Japan unexpectedly fell for the third straight month, prompting renewed fears the economy is losing steam.

Factory output dipped 0.1% in June, compared to the previous month. It follows a 3.4% decline in May.

The data indicates weak overseas demand for Japanese products.

"Industrial production appears to be flat," the Ministry of Economy, Trade and Industry reported, downgrading a May forecast of production recovering.

The fall was mainly due to decreased output in the machinery, iron and steel sectors, data showed.

It comes after the central bank and government authorities said the economy was recovering from last year's earthquake and tsunami that caused major damage to factory production.

Eurozone threat

However, they did add that the European debt crisis remains a major threat to the recovery.

Japan's biggest steelmaker Nippon Steel Steel output was one the main drivers of the lower factory output figures

"Economic growth is on a much weaker trend than what the government and the Bank of Japan are telling us to believe," said Satoshi Osanai from Daiwa Institute of Research.

"Any recovery will be temporary and the economy will continue to languish for months ahead. Exports to the US are already at high levels and have little room for additional growth," he added.

The strong yen is another hurdle for Japanese exporters has it makes their goods more expensive overseas.

More on This Story

Global Economy

The BBC is not responsible for the content of external Internet sites

More Business stories

RSS

Features

  • NS Savannah, 1962Nuclear dream

    The ship that totally failed to change the world


  • Espresso cup7 days quiz

    Which city serves the strongest cup of coffee?


  • Glasgow 2014 quaichs and medalsQuaich guide

    What do the Scottish gifts given to Games medallists symbolise?


  • Malaysian plane wreckage in UkraineFlight risk

    How odd is it for three planes to crash in eight days?


  • israel flagDos and don'ts

    Can you criticise Israel without being anti-Semitic?


BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.