Japan’s All Industry Activity Slowed In August Missing Expectations

  @AmruthaGayathri on October 21 2013 1:39 AM
JapanManufacturing
A man walks inside a factory at Keihin industrial zone in Kawasaki, south of Tokyo June 28, 2013. Reuters/Yuya Shino

Growth in Japan’s industry activity, combining construction, agriculture, the public sector and industrial output, slowed to 0.3 percent in August on a monthly basis, missing expectations of a 0.4 percent uptick and down from a rise of 0.4 percent in July, data from Japan’s Ministry of Economy, Trade and Industry showed on Monday.

Japan’s leading economic index, which consists of 12 indexes such as account inventory ratios, machinery orders, stock prices and other leading economic indicators, was at 106.8 in August, lower than July’s reading of 107.9, according to official data.

The country’s coincident index, which tracks the current state of the economy, also slid marginally to register a reading of 107.6 in August, slightly lower than a reading of 107.7 in July.

Earlier on Monday, Japan reported that it had posted a record fifteenth-straight monthly trade deficit in September of 932.1 billion yen ($9.5 billion), narrowing from August's 960.3 billion yen but up 64 percent from a year ago, and above analysts' estimate of a deficit of 927 billion yen.

Exports, helped by a persistently weak yen, were up 11.5 percent -- for a seventh-straight month year-on-year -- yet substantially lower than expectations of a 15.6 percent increase, the Wall Street Journal reported. Imports, which were up 16.5 percent in September over the previous year to record an eleventh-straight uptick, also failed to meet expectations of a 20.3 percent increase.

"The widening of the trade deficit to a record high in September highlights that the sharp fall of the yen over the past year has had little impact on export competitiveness. While lower import prices should provide some support in the coming months, the trade deficit is likely to remain deeply in the red," Marcel Thieliant, Japan economist at Capital Economics, said in a note.

 

Join the Discussion