Japan industrial output falls, unemployment rate unchanged
The recovery in the world’s second largest economy appears to be faltering after figures today revealed a fall in industrial output.
Japan’s industrial output has fallen for the first time in a year, by 0.9% in February, following strong growth in the previous month, according to official figures.
“The first decline in the past year in industrial output is a slightly worrying factor,” said Taro Saito at the NLI Research Institute.
The fall was larger than many analysts had expected and comes as the economy battles with deflation.
Last week, it was announced Japanese core consumer prices fell 1.2% in February from a year earlier – representing the 12th consecutive monthly decline that Japan has been in deflation.
Deflation (where prices fall rather than increase) can be a serious threat to an economy because it deters consumers and businesses from spending in expectation of falling prices.
Japan has battled with deflation in the past and was a problem for the economy during its so-called “Lost Decade” in the 1990s in which the economy struggled with falling prices.
Separately, the Labour Ministry said Japan’s unemployment rate remained unchanged in February at 4.9%.
Japan’s economy grew by 0.9% in the last three months of last year, however the recovery has been held up by Government stimulus measures.
Analysts are fearful that once stimulus measures are withdrawn, the recovery may slow.
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