Japan industrial output drops at lesser-than-expected rate, retail sales surge

Industrial production in Japan contracted at a monthly rate of 0.9% in November, reversing from a final 1.3% growth in October, preliminary data by the Ministry of Economy Trade & Industry showed.

In comparison, market consensus had pointed to a steeper drop, by 1.6%.

It has been the first output drop since August, mostly driven by lower production of motor vehicles (-2.5% versus 2% in October), electrical machinery and information & communication electronics equipment (-3.5% versus 2.9% in October), and general-purpose and business oriented machinery (-3.8% versus 2.3% in October).

Meanwhile, retail sales in the country were reported to have surged 5.3% year-on-year in November, while outstripping market expectations of a 5% growth and picking up pace for the first time in three months.

The figure followed a revised down 4.1% growth in October.

It has also been the 21st successive month of retail sales growth, since Japanese consumption continued recovering from the COVID-19 pandemic-induced drop.

In month-over-month terms, Japan’s retail sales rose 1% in November, following a 1.6% slump in October.