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Japan industrial output falls greater-than-expected 2 percent, large-scale retail sales drop

Japan industrial output falls greater-than-expected 2 percent, large-scale retail sales drop

Japan got some disappointing economic news Thursday from figures showing that industrial production dropped more than expected in January and that sales at large-scale retailers declined for the second month.
Industrial production _ a widely watched indicator in this export-driven economy _ fell 2 percent in January from December, worse than the 0.6 percent drop projected by economists.
The bulk of the decline was attributed to lower production of electronic parts and devices exported to Asia and Europe as well as car production for the Middle East and the United States, the Ministry of Economy, Trade and Industry said. Sluggish output of general machinery added to the drop.
That adds to recent worries that a global economic downturn may lead to weakened Japanese exports, which in turn may weigh on the overall economy. Factory output rose 1.4 percent in December, following a drop of 1.6 percent in November.
The ministry said that manufacturers polled expect that their output will fall another 2.9 percent in February before increasing 2.8 percent in March.
Separate data released by the same ministry showed that nationwide retail sales rose 1.5 percent in January from a year earlier, but the gain was lifted mainly by higher fuel prices.
The report also said sales at large-scale retailers declined 1.9 percent after adjustment for the change in the number of stores.
Economists are pessimistic about the outlook for Japan's private spending as consumer sentiment has been at multiyear lows in recent months due to sluggish wage growth and rising energy and food prices.
With wages unlikely to rise much in the months ahead, economists are worried that consumer spending, and eventually domestic demand, may weaken.
The reports helped depress Japan's stock market Thursday, when the benchmark Nikkei 225 stock index dropped 0.75 percent to 13,925.51 points.


Updated : 2021-02-27 15:38 GMT+08:00