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May-01-2009Japan's Economy May Return to Growth as Output Climbs(topic overview)
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The central bank expects the pace of decline in exports and production to slow in the first half of the year and the economy to recover gradually in the second half as the effects of economic stimulus measures adopted by various governments kick in. Thereafter, the Japanese economy is expected to return to a growth rate above its potential in 2010, the BoJ said. It expects prices, excluding fresh foods, to decline by 1.5 per cent, rather than the previously forecast 1.1 per cent, because of the decline in oil prices, the stabilisation of food prices and slumping demand. The BoJ's latest assessment of Japan's economic outlook was much more bullish than that of private economists, who expect growth to shrink more than 4 per cent this fiscal year. [1] In the United States, data showed the economy had shrunk at a faster than expected pace in the first quarter of the year, although other indicators gave cause for hope. The Bank of Japan said on Thursday that the economy is expected to shrink 3.1 per cent in this fiscal year to March, from a two percent contraction predicted in January. It said the pace of decline in exports and production will decelerate in the first half of the year, even though consumer spending will remain weak. 'Therefore, the pace of deterioration in economic conditions will likely moderate gradually and start to level out,' the bank said, adding that it foresaw 1.2 per cent growth in the next fiscal year. It said other risks lingered, including a spreading swine flu outbreak, whose effects on the economy 'need to be monitored carefully.' The Bank on Thursday held interest rates at 0.1 per cent.[2] Investors welcomed the better-than-expected data, with Tokyo shares soaring almost 4.0 percent, helped by strong gains on Wall Street. Japan's economy suffered a brutal annual contraction of 12.1 percent in the last three months of 2008 and analysts say this year's first quarter could be even worse. The Bank of Japan predicted Thursday that the economy would shrink 3.1 percent in this fiscal year to March, more than previously expected. The pace of decline in exports and production would slow, paving the way for 1.2 percent growth in the next fiscal year to March 2011, the bank said as it left its key interest rate on hold at 0.1 percent, as expected.[3]
The Bank of Japan has trimmed official borrowing costs twice since October. With little room left to reduce rates further, it is turning to alternative tools to spur lending, such as purchases of bonds. Japan's economy logged its worst performance in almost 35 years in the last quarter of 2008 and this year's first quarter is feared to have been even worse. The slump has shown some signs of improving recently, with both exports and industrial output rebounding slightly in March from the previous month. Even so the Bank of Japan is widely expected to downgrade its economic forecasts for the current fiscal year to March when it releases its outlook report for economic activity and prices later in the day.[4] The Bank of Japan (BOJ) on Thursday pruned its forecast for economic growth for the fiscal year 2009 but promised a return to growth in the fiscal year 2010 on expectations of a rebound in financial markets and overseas economies. It expects real GDP to contract 3.1% in the year that ends in March 2010, compared with January's prediction of a 2% drop. Japan's economy shrank an annualized 12.1% in the last quarter of 2008 and analysts expect a similar pace of contraction in the first quarter of 2009. "Economic conditions in Japan have deteriorated significantly," the BOJ said in its semiannual economic outlook report, noting that in the corporate sector exports have also decreased significantly because of the sharp downturn in overseas economies. The outlook for Japan's economy from fiscal 2009 through fiscal 2010 will likely greatly depend on developments in overseas economics and global financial markets, the BOJ said in its report.[5] "Economic conditions are likely to continue deteriorating in the coming months but gradually level out thereafter, and the growth rate is expected to recover at a moderate pace from the latter half of fiscal 2009," the BOJ said in a statement released after its Policy Board meeting. The BOJ "will continue to exert its utmost efforts. to facilitate the return of Japan's economy to a sustainable growth path with price stability," while continuing to pay attention to the downside risks to economic activity and prices. The BOJ board cut its January forecast for real gross domestic product for the 2009 fiscal year from minus 2 percent to minus 3.1 percent. The central bank also lowered its forecast for growth in fiscal 2010 from 1.5 percent to 1.2 percent. As for the consumer price index, the BOJ lowered its earlier forecast for the current fiscal year to minus 1.5 percent, down from the minus 1.1 percent it estimated in January.[6] NEW YORK, April 29 (Reuters) - The Bank of Japan is expected this week to cut its forecast for Japan's economy, which it now thinks will shrink by 3 percent to 4 percent in fiscal year 2009, the Nikkei business newspaper reported on Wednesday. The central bank had previously projected a 2 percent fall in gross domestic product, but conditions have worsened, particularly for exports, which have slid sharply, the Japanese newspaper reported on its website. The bank's semiannual "Outlook for Economic Activity and Prices" is due out on Thursday and it will likely stick to its view that the economy will start to recover in the second half of the fiscal year in 2010, Nikkei said. The most recent government data showed Japanese exports in March were at almost half their levels compared with a year earlier. That was only a slightly better showing than the record 49.4 percent slide posted in the 12 months to February.[7]
The decision to keep rates on hold was made by a unanimous vote, as widely expected. The BOJ will release its half-yearly economic and price outlook report for April at 3 p.m. (6 a.m. British time). Governor Masaaki Shirakawa will then hold an embargoed news conference, with his comments expected to come out some time after 4:15 p.m. Japan's economy is mired in its worst recession since World War Two and after a 3.2 percent slump in the fourth quarter of 2008 is expected to have contracted even more in the first quarter of this year, despite some early tentative signs of recovery in exports. The central bank releases its outlook report with its long-term economic and price forecasts in April and October each year. These forecasts form a base for its monetary policy decisions. It reviews the forecasts in January and July.[8] TOKYO, April 30 (Reuters) - The Bank of Japan is set to cut its economic forecasts on Thursday but will probably hold fire on policy as it gauges the impact of recent steps to help the economy cope with its worst recession since World War Two. With the focus on its twice-yearly forecasts, the central bank is expected to keep interest rates at 0.1 percent and limit any action to fine-tuning of existing policies geared to easing of corporate funding strains. The BOJ's board meets a day after the U.S. Federal Reserve kept its benchmark rate near zero and refrained from any new steps to revive the world's biggest economy, in which it said the contraction appeared to be slowing. Reflecting hopes the global economy may be past the worst phase of recession, Japan's central bank is due to stick to its main scenario that the world's No. 2 economy will start picking up late this year or early in 2010. The report will also cite various risks to that scenario, such as uncertainty over the timing of the global recovery, which will be essential for Japan given its heavy reliance on exports.[9] TOKYO, April 30 (Reuters) - Bank of Japan Governor Masaaki Shirakawa said on Thursday the central bank would not rule out any policy option to help the economy, but signalled there was no need to increase its long-term government bond buying for now. In a half-yearly economic and price outlook report issued on Thursday, the central bank slashed its forecasts and warned of a deeper contraction and deflation, but also said it saw signs the global economy was stabilising. It kept interest rates on hold at 0.1 percent and held off on any new policy initiatives.[10]
Stocks surged after the data's release, with the benchmark Nikkei 225 index soaring nearly four per cent. The central bank followed with its own relatively upbeat appraisal in the afternoon after the policy board left the key interest rate unchanged at 0.1 per cent. While it projects Japan's gross domestic product to contract 3.1 per cent this fiscal year through March 2010, it sees a turnaround emerging in the second half. "Recently, signs of a levelling out of economic activity are beginning to be seen globally" in the wake of government stimulus plans around the world, the Bank of Japan said in its closely watched semiannual economic outlook report.[11] The central bank had forecast in January that the economy would contract by around two per cent. However the BoJ said it expected to see 1.2 per cent growth in the next fiscal year, saying that overseas economies will start recovering from the second half of this year, aided by government efforts to tackle the recession. Japan's economy, driven by foreign sales of its cars and electronic gadgets, has been mired in its deepest recession since the end of World War II, hit by plunging levels of global consumer and corporate spending. Major exporters such as Toyota Motor Corp and Sony Corp have responded by reducing shifts, suspending factory lines and slashing thousands of jobs over the past few months.[12] TOKYO (AFP) - Japan's economy is expected to shrink 3.1 percent in this fiscal year to March, more than previously feared, before returning to positive growth next year, the central bank said Thursday. The Bank of Japan downgraded its forecast given in January for the world's second biggest economy to contract by 2.0 percent this year.[13] Japan's recession will be deeper than first thought but its export slump should soon start to ease, putting the economy on course for positive growth next year, the central bank said Thursday. The world's second largest economy is expected to shrink 3.1 percent in the current fiscal year to March, the Bank of Japan said, downgrading its earlier forecast for a 2.0 percent contraction. It estimates the economy shrank 3.2 percent in the previous fiscal year. Japan also faces two years of deflation, with consumer prices expected to drop 1.5 percent this year and 1.0 percent the following year, it said.[14]
"A leveling out of economic activity beginning to be seen globally" in the wake of government stimulus, the Bank of Japan said in a semiannual report. Japan's recession would be deeper than first thought, it said, but its export slump should soon ease, pushing it to growth in 2010. Japan is expected to shrink 3.1 percent in the current fiscal year to March, the Bank of Japan said, downgrading its earlier forecast for a 2 percent contraction.[15]
The Bank of Japan on Thursday lowered its economic growth forecast for the current and 2010 fiscal years and revised its inflation outlook downward amid the global recession. With little room left for a further rate cut, however, the BOJ decided to maintain its key interest rate at 0.1 percent. It also refrained from expanding a program of purchasing corporate and government debt.[6] The Bank of Japan said recovery would be dependent on the return of the world economy to global growth, and stability in financial markets. It is keeping interest rates at 0.1%, and hoping that the big stimulus package announced by the Japanese government will help boost growth. The government submitted its plans to the Diet for its latest stimulus package, worth 15 trillion yen ($155bn, £105bn). "The BOJ's growth forecast reflects its expectations that the massive fiscal spending will have a positive effect in bolstering GDP, as well as a rebound from sluggish growth a year earlier," said Takeo Okuhara at Daiwa SB Asset Management. These are grim times for Japan's economy but the latest figures from the government show a small improvement.[16]
TOKYO, April 30 (Xinhua) -- Following its January projection of the worst negative economic growth in the postwar era, Japan's central bank has revised its forecast downward as the worldwide economic crisis deepens, and the world's second largest economy is expected to plunge into worse recession. At the policy-setting meeting on Thursday, the Bank of Japan (BOJ) lowered its projections for the nation's economy, predicting a 3.1 percent year-on-year contraction for its real GDP in fiscal 2009, against a previously estimated 2.0 percent shrinkage. The prediction came three days after the cabinet office downgraded its economic projection from a previously estimated zero growth to a shrinkage of 3.3 percent for fiscal 2009, labeling the Japanese economy as "deteriorating at an unprecedented speed" amid the ongoing financial crisis.[17] The Bank of Japan (BOJ) on Thursday left its key rates unchanged in a unanimous decision before releasing its outlook on the world's second-biggest economy and inflation later today. In the report, the BOJ is expected to cut its economic growth projection from the 2% contraction predicted three months ago. The Japanese central bank's policy board voted today to keep its uncollateralised overnight call rate unchanged at 0.1%, as had been widely expected.[18]
The bank's policy board voted unanimously at a one-day meeting to keep the interest rate at 0.1 per cent as widely expected. The BOJ also revised downward its economic forecast saying that Japan's economy would contract at a pace of 3.1 per cent during fiscal 2009 that began April 1 from an earlier projection of a 2-per-cent fall.[19] The Bank of Japan expects growth to contract by a significantly greater margin than it forecast just two months ago as the world'''s second largest economy continues to suffer from a collapse in demand. '''Economic conditions in Japan have deteriorated significantly,''' the BoJ said in a statement on Thursday as it lowered its forecast for the economy to a 3.1 per cent contraction in the year to next March, rather than a previously expected 2 per cent decline in growth.[20] Fastening on to the improved outlook, the Tokyo stock market, having returned from a break on Wednesday, jumped 3.94 per cent, with the Nikkei 225 index closing at 8828.26 points. The central bank yesterday cut its GDP forecast for fiscal 2009, the year to March 31, from a shrinkage of 2 per cent to minus 3.1 per cent, projecting Japan's worst annual output slump in the post-war period. "Economic conditions are likely to continue deteriorating in the coming months but gradually level out thereafter," the Bank of Japan said in its six-monthly forecast.[21] Exports in March managed to rise two per cent from the previous month, the first increase in nearly a year. The central bank is quick to hedge its outlook, warning any number of things could derail a true turnaround. Although positive signs have emerged, it remains uncertain "whether these developments will lead to a steady recovery of the world economy," it said, citing ongoing economic and financial risks as well as a new one: swine influenza.[11] The BoJ said the outlook for Japan's economy was likely to depend on developments in overseas economies and warned that "it was still not certain. whether would lead to a steady recovery of the world -economy." The central bank kept its benchmark overnight lending rate at 0.1 per cent and failed to announce additional policy measures despite its gloomier outlook for the economy.[1] TOKYO - JAPAN'S central bank said on Thursday that it was holding its benchmark interest rate steady at 0.1 per cent as it seeks to rescue the economy from its worst slump in decades.[4]
Industrial production rose 1.6 percent in March from February, the Ministry of Economy, Trade and Industry said. The central bank followed with its own upbeat appraisal, after it left its key interest rate steady at 0.1 percent. While it projects Japan's gross domestic product to contract 3.1 percent this fiscal year through March 2010, it sees a second-half turnaround.[15] The central bank chose to keep interest rates on hold at 0.1 per cent, following the same decision from the U.S. Federal Reserve last night. It has also emerged that industrial output in Japan rose by 1.6 per cent in March from the previous month, helped by an increase in Chinese demand for electronic parts used in mobile phones and computers.[22] Japan's economy received a boost this week as new figures revealed that industrial output rose during March. The Ministry of Economy, Trade and Industry announced on Thursday (April 30th) that production was up by 1.6 per cent in this sector - the first increase in six months. It was not all good news.[23] Data released yesterday showed that Japan's industrial production rose at twice the pace widely expected in March, climbing 1.6 per cent month-on-month and raising hopes that the economy might be over the worst of the recession. While this was the first rise in factory output for six months, some analysts suggested that it represented inventory restocking rather than a recovery of demand.[1] After tumbling sharply in recent months, industrial production rose 1.6 per cent in March from February, the Ministry of Economy, Trade and Industry said. It marked the first climb in half a year and beat Kyodo news agency's average market forecast for a 0.9 per cent uptick.[11]
The forecast was less gloomy than many analysts expected and the bank said there were signs of better times ahead, predicting the pace of decline in exports and production would decelerate in the first half of the year. Overseas economies would start recovering in the second half of this year, supported by government efforts to fight the recession, laying the ground for the economy to grow 1.2 percent in the year to March 2011, the BoJ said.[14] The outlook for Japan's economy from fiscal 2009 through fiscal 2010 is likely to greatly depend on developments in overseas economies and global financial markets. In the first half of fiscal 2009, it is expected that, while domestic private demand will continue to weaken, the pace of decline in exports and production will decelerate as inventory adjustments make progress both at home and abroad. Therefore, the pace of deterioration in economic conditions will likely moderate gradually and start to level out. It is expected that, from the latter half of fiscal 2009 onward, global financial markets will regain stability and overseas economies start recovering, supported by the positive effects of policy actions taken in various countries and by the gradual adjustment of various excesses in financial and economic activity that had accumulated until around the mid-2000s.[24] "Economic conditions are likely to continue deteriorating in the coming months but gradually level out thereafter," bank governor Masaaki Shirakawa told a press conference. "The growth rate is expected, from the latter half of fiscal 2009, to recover at a moderate pace," he said. Japan's economy suffered a brutal annual contraction of 12.1 percent in the last three months of 2008 and analysts say this year's first quarter could be even worse.[14] TOKYO (Dow Jones)--The Bank of Japan on Thursday downgraded its outlook for economic growth to a record low level, predicting a 3.1% contraction in gross domestic product this fiscal year but maintaining hope that the economy will pull out of its slump in the second half. BOJ Gov. Masaaki Shirakawa told reporters Thursday afternoon, after the bank issued its semiannual outlook report on the economy and prices, that he expects the economy to pick up at a moderate pace in the latter half of.[25] Shipment levels--what factories finish and send off--rose by a similar amount, again representing a drop of one-third since last year. Inventories also fell by 3.3% over February, nearly 5% lower than last year, as businesses cleared out their stores of goods in response to the economic slowdown. Businesses are starting to feel better about their prospects. Companies the ministry surveyed said they plan to boost production by an average 4.3% in April and 6.1% in May. That's nowhere near boom-time levels, but it does mark an encouraging start. The Bank of Japan struck a more somber note Thursday, however, saying the economy won't start to recover until the latter half of the current fiscal year, which began this month.[26]
The optimistic news was tempered by an announcement from the Bank of Japan that it now expects the Japanese economy to shrink by 3.1 per cent in the fiscal year to March, more than was previously expected.[12] The world's second biggest economy has been hit hard by the global downturn, sliding into a sharp recession. Meanwhile the Bank of Japan has downgraded its forecast for the economy. It now suggests that GDP will shrink by 3.1% in the year to March 2010, compared to an earlier forecast of 2%, but it argues that a recovery will begin in 2010. It warned that consumer prices will fall by 1.5%, pushing Japan into deflation. Its economic forecast is still much more optimistic than the IMF, which forecast a 6.2% fall in the Japanese economy - the largest of any G7 countries.[16] The ministry had predicted a bit of a turnaround for March and April. Bank of Japan, announcing its economic forecast through the 2010 fiscal year on Thursday, predicted an extended decline in the nation's economy.[27] The Bank of Japan has issued a downbeat report on the country's economy and reduced forecasts for growth. In January, policy board members forecast a contraction of 2% in the economy in the fiscal year 2009, but this has since been revised to 3.2%.[28] The Bank of Japan's eight-member policy board voted unanimously Thursday to leave the overnight call rate target unchanged at 0.1 percent, as widely expected. Separately, the bank said in its semiannual economic outlook report that it expects Japan's economy to shrink 3.1 percent this year, more than the 2 percent contraction projected in January.[29]
TOKYO - JAPAN on Thursday warned that the world's second biggest economy would shrink more than expected this year as it battles its worst recession in decades. The forecast came despite data showing industrial output rose for the first time in six months, while Asian stocks soared on hopes that the world's major economies may be approaching the end of their downward spiral.[2] Stocks across Asia rose overnight after the Bank of Japan (BOJ) said that the world's second largest economy will begin to recover in the second half of the year and factory output rose for the first time in six months.[22]
Tokyo said on Thursday that industrial production rose for the first time in six months in March. Factory output, pivotal in this export-oriented economy, is projected to rise 4.3 percent this month and 6.1 percent in May.[15] Japan's industrial production rose 1.6 percent in March, government data showed, exceeding market expectations. It also showed manufacturers expect output to rise 4.3 percent in April and increase 6.1 percent in May.[30] The March figures show a 1.6% on-month increase in industrial production, a key gauge of Japan's economy. That was more than the 0.5% increase expected on average by economists surveyed by Dow Jones and The Nikkei, and fueled expectations that manufacturers' sharpest production cuts are behind them, analysts said. Reflecting the improved sentiment, the government changed its assessment of output from "rapidly declining" to "stagnant," as shipments.[31]
The new figures are a sign that the strategy of Japan's manufacturers - to mothball production lines, reduce shifts and lay off staff - may be working. Japan has been hit badly by the downturn because worldwide demand has collapsed for its cars and electronics. The increase follows figures earlier this month showing that exports have also risen slightly, although shipments are still running at just over half the levels of a year ago. A government survey of manufacturers showed they expect industrial production to continue to rise, by 4.3% during April and by 6.1% in May.[16] After many months of dramatic decline, the larger than expected increase has been heralded as a sign that the country may be coming out of its dive in production and exports. A government survey of manufacturers has shown they expect industrial production to continue to rise.[32]
The government attributed the output decline to the global economic turmoil, which slowed exports. Japan's manufacturers expect output to continue its rise in April and May.[33]
According to the statistics released Thursday by the Japan Automobile Manufacturers Association, the nation's auto production and exports dropped for the first time in seven years in fiscal 2008 due to a plunge in vehicle sales worldwide triggered by the global financial crisis.[17] The Japan Automobile Manufacturers Association reported yesterday that March production of cars, trucks and buses fell 50 per cent year on year, while exports dropped 64.3 per cent. Fujifilm Holdings, forecasting its first operating loss in 60 years for 2009-10, yesterday announced a Y150 billion ($2.1 billion) restructuring of its worldwide operations that would cost 5000 jobs.[21]
Factory production rose for the first time in six months in March and companies plan to increase output to replenish inventories, a report showed today. Gross Domestic Product (GDP) fell at an annualised rate of 12.1% in the last quarter of 2008 due to a collapse in exports and analysts expect a similar pace of contraction in the first quarter of this year.[18] TOKYO (Dow Jones)--Japanese industrial output rose in March for the first time in six months, preliminary government data released Thursday showed, as manufacturers moved more products from their shelves and dialed up production.[31] TOKYO, April 30 (Reuters) - Japan's industrial output rose more than expected in March, the first gain in six months, in a further sign that Japan's plunge in production and exports may be nearing an end.[34] Tokyo - Japan's industrial output in March marked the first growth in six months, thanks to increased production in the high-tech and machinery sectors, the government said Thursday.[33]
TOKYO (AP) — Japan's government says industrial production in March rose 1.6 percent, the first increase in six months.[35]
Government figures released on Thursday showed industrial output rose 1.6 per cent in March compared with a month earlier, with forecasts that production will increase further in April and May.[12] Industrial output fell 22.1 per cent on a quarterly basis in the January-March period, and the Japanese Government said earlier in the week that it expected industrial production to fall a record 23.4 per cent in the fiscal year started April 1.[36] Overall industrial production in Japan fell 22.1% in the January-March period from the previous quarter, and Japan's government announced earlier in the week that it forecasts a shrink in industrial output by a record 23.4% in the fiscal year which started April 1.[37]
The annual inflation rate for 2008 was left unrevised at 1.2%. Last week, the Japanese government had lowered its GDP forecast for the current fiscal. On plunging exports, the economy is expected to contract 3.3% this fiscal year, the biggest drop since the government started to compile growth in 1955.[38] The BOJ said the Japanese economy would start recovering before March 2010 after businesses make more inventory adjustments and policies taken by other countries start to show effects. Although the nation's economy continues to deteriorate for the time being, 'the growth rate is expected, from the latter half of fiscal 2009, to recover at a moderate pace,' the bank said.[19] In fiscal 2009 ending on March 31, 2010, the cabinet office predicted that exports will plunge 27.6 percent year-on-year, down from a 3.2 percent decline estimated in December while business investment is revised downward from a 4.2 percent fall to a record plunge of 14.1 percent. "Economic conditions are likely to continue deteriorating in the coming months but gradually level out thereafter, and the growth rate is expected, from the latter half of fiscal 2009, to recover at a moderate pace," said the BOJ report.[17] "Economic conditions are likely to continue deteriorating in the coming months but gradually level out thereafter," bank governor Masaaki Shirakawa told a press conference. "The growth rate is expected, from the latter half of fiscal 2009, to recover at a moderate pace," he said.[3]
"The pace of deterioration in economic conditions will likely moderate gradually and start to level out," the central bank stated. BoJ expects economic activity and corporate profits to gradually pick up from the latter half of fiscal 2009. Improvements in financial conditions are expected to support the recovery in the latter half of the projection period.[38] The Japanese central bank expects the pace of deterioration in economic conditions to likely moderate gradually and start to level out. From the latter half of fiscal 2009, global financial markets will regain stability and overseas economies will start recovering, it added.[5]
With interest rates close to zero, the central bank has little room to tweak regular monetary policy and has instead focused on less conventional measures to boost corporate financing. The central bank already buys commercial paper, corporate bonds and stocks from financial institutions to help shore up their balance sheets. The BOJ has refrained from making any major policy announcements this month, suggesting that board members may be monitoring the latest economic cues before they decide what to do next. "Economic conditions in Japan have deteriorated significantly," the central bank said in its economic report.[29] The central bank did not announce any new policy measures along with the monetary policy statement. In its semiannual Outlook for Economic Activity and Prices, BoJ said Japan' economic outlook for the fiscal 2009 deviated downward from the assessment conducted in January.[38] The central bank warned that the possible spreading of the new type of influenza and its influence on economic activity need to be monitored carefully. It forecasts a decline in the fiscal year's core consumer price index (CPI), excluding fresh food prices, of 1.5%, worse than the January forecast for a fall of 1.1%.[5]
In its semi-annual economic outlook published on Thursday, the BOJ said it expects the economy to contract 3.1% in the 2009 fiscal year, down from the 2.0% decline previously forecast.[39]
Tokyo - While the Bank of Japan (BOJ) on Thursday decided to maintain its key short-term interest rate unchanged in the face of Japan's worst recession since World War II, it projected the nation's economy to return to growth in the last six months of the current fiscal year.[19] "Because the shock that the world economy experienced since the last autumn was so strong, it would take some time before we see a recovery," Shirakawa said. Risks also linger, including a spreading swine flu outbreak, the effects of which on the economy "need to be monitored carefully," he added. The Bank of Japan on Thursday held its benchmark interest rate steady at 0.1 percent, as expected. With little room left to reduce rates further, the bank has turned to alternative tools to spur lending, such as purchases of bonds.[14] The organization said that there is little time left for countries to beef up containment measures before the virus spreads further. As expected, the Bank of Japan left its benchmark interest rate unchanged at 0.10%. It also cut the GDP forecast to a 3.1% contraction for fiscal 2009 and said it expects core CPI in the -1.4% to -1.6% range.[40]
Tokyo'' - The Bank of Japan on Thursday decided to maintain its key short-term interest rate unchanged at 0.1 per cent as widely expected.[41] Japan's central bank last lowered the interest rate from 0.3 per cent to 0.1 in December.[41] TOKYO (AP) — Japan's central bank kept its benchmark interest rate steady amid signs that the country's economic picture may be brightening.[29] TOKYO (AFP) — Japan on Thursday reported its first increase in factory output in six months, adding to hopes of an economic recovery that the central bank said should start to take root later this year.[3]
The central bank reiterated that the economic conditions in Japan have deteriorated significantly. The economy is expected to shrink 3.1% this fiscal and to grow 1.2% in the fiscal 2010.[38] During a one-day panel meeting, eight members of the central bank's policy board voted unanimously to hold the overnight call rates unchanged. At the policy meeting, the BOJ lowered its projections for the nation's economy, predicting a 3.1 percent year-on-year contraction for its real GDP in fiscal 2009, against a previously estimated 2.0 percent shrinkage.[42]
Japan's interest rates are among the lowest of major economies. The Federal Reserve on Wednesday kept its targeted range between zero and 0.25 percent, while the European Central Bank's benchmark rate stands at 1.25 percent.[29] TOKYO, April 30 (Xinhua) -- The Bank of Japan (BOJ) decided Thursday to keep its key interest rate steady at 0.1 percent.[42] TOKYO (Reuters) - The Bank of Japan kept interest rates on hold on Thursday and held off on any new initiatives as it gauges whether the measures it has taken so far to ease credit strains are helping ease the country's worst recession since World War Two.[8]
The Bank of Japan predicted that the country's economy would continue to contract over the next year and at a quicker rate than previous projections - an increase from two per cent to three per cent.[23] "Unless we can see a recovery in the U.S. economy, it is too early to say Japan's economy is back on track. Japan's economy suffered a brutal annual contraction of 12.1 per cent in the last three months of 2008 and economists say this year's first quarter could be even worse.[12] "The BoJ is expecting a V-shaped recovery," said Masaaki Kanno, economist at JPMorgan in Tokyo. Limiting the annual contraction to 3.1 per cent will require very strong growth in subsequent quarters because first-quarter GDP is expected to be very weak, he said. The BoJ's outlook for a firm recovery later this year comes amid one of the most dismal earnings seasons Japan has seen in recent decades.[1]
The BOJ said that it expects gross domestic product (GDP) to shrink by 3.1 per cent in the year to March, worse than the 2 per cent contraction it forecast in January, but it said that from October onwards it forecasts a "moderate" recovery.[22]
Earlier on Thursday Tokyo said factory output was up 1.6 per cent in March month on month, the first rise since September, while manufacturers forecast the figure was likely to add a further 4.3 per cent in April and 6.1 per cent in May.[2] JAPANESE industrial output rose in March for the first time in six months, showing a monthly increase of 1.6 per cent.[36] Japanese industrial output increased for the first time in six months, but the Bank of Japan said it expects the nation's economy to continue to contract into 2010.[27] TOKYO, April 30 (Reuters) - Japanese government bond futures fell on Thursday after data showed a bigger-than-expected rise in industrial output, offering a sign that Japan's recession-hit economy may be starting to stabilise.[30] Today'''s figure follows a 9.4% plunge in February and a record fall of 10.2% in January. The future is also looking promising after the Government is forecasting industrial production to rise 4.3% this month and up 6.1% in May. The Japanese economy, which is the second largest in the world, was once seen as relatively unscathed by the global financial crisis but it has been hit by a slump in demand for its products overseas.[43] Policy board members say the economy is 'greatly' dependent on the developments in the rest of the world and the global financial markets. Therefore it is likely that domestic demand will continue to weaken in the first half of 2009, but the pace of decline in exports and production will decelerate so the deterioration in Japanese growth will begin to flatten out.[28]
The pace of decline in exports and production will decelerate in the first half of the year, even though consumer spending will remain weak, it said. "Therefore, the pace of deterioration in economic conditions will likely moderate gradually and start to level out," the bank said. Overseas economies will start recovering from the second half of this year, supported by government efforts to tackle the recession, it said.[13] According to the central bank, domestic private consumption will continue to deteriorate. The pace in export and production declines will ease as inventories are adjusted both domestically and abroad. "Therefore, the pace of deterioration in economic conditions will likely moderate gradually and start to level out," the central bank said. The BOJ also noted that corporate financing conditions had begun to loosen compared to the latter part of 2008 due to improved issuing conditions in both the corporate bond and commercial paper markets.[39]
The increase to a seasonally adjusted index level of 70.6 marked the first gain in industrial output for Japan in six months and may be a sign that Japan's decline in production and exports are slowly coming to an end.[44] Much is riding on industrial output. Japan's export-led economy depends on manufacturers, in particular high-tech companies, which were the largest component of the production increase this month.[26] Japan'''s unemployment rate has risen to a 3-year high of 4.4%, up from 4.1% in January, while business confidence among major manufacturers recently plummeted to a 35-year low. The country has just announced a further stimulus package to boost struggling companies and support regional economies - it is the third such stimulus since last October, introduced to boost the Japanese economy and fight off a prolonged recession. Today'''s figures follows data released earlier this month showing that exports have also seen a marginal increase.[43]
The key gauge of Japan's economy delivered a stronger result than the 0.5 per cent increase expected by economists surveyed by Dow Jones and The Nikkei, according to preliminary government data released today.[36] Japan's economy began shrinking in the second quarter of 2007 and it suffered a brutal annual contraction of 12.1 per cent in the last three months of 2008. Analysts said that this year's first-quarter result could be even worse.[36]
Forecasts showed Japan's manufacturing sector, pivotal for the country's export-oriented economy, is projected to rise 4.3 per cent in April and another 6.1 per cent in May.[12] Inventories fell 3.3 per cent in March, while shipments rose 1.4 per cent, the Ministry of Economy, Trade and Industry data showed. Analysts said manufacturing levels were still low on the basis of annual comparison, and that they were likely to stay depressed as struggling overseas economies now demanded far fewer Japanese cars, electronics products and other high-end goods.[36] The March output rose 1.6 per cent in seasonally-adjusted terms, following a 9.4-per-cent drop in February and a record 10.2-per-cent fall in January, the Ministry of Economy, Trade and Industry said in a preliminary report.[33]
The Ministry of Economy, Trade and Industry's industrial production index increased 1.6 per cent in March on the previous month, particularly reflecting a rebound in Chinese demand for electronics components.[21] After the hair-raising collapse in global trade since September and in spite of last month's positive read-out, Japan's industrial production in the March quarter still shrank by a record 22 per cent. "It's clearly better than a few months ago, when we couldn't see a bottom in output," Maiko Noguchi, a senior economist at Daiwa Securities SMBC told Reuters.[21] Overall industrial production is still near lows last seen in 1983 with output between January and March sinking by a record 22.1 per cent from the previous quarter.[22]
Industrial production has dived by about a third in the past six months, while the March figure is still 34.2 per cent lower year on year.[2]
Inventories of motor vehicles and other transport equipment dropped 18.5 per cent in March, while consumer electronics and communications equipment stocks fell 14.6 per cent. Led by majors such as Toyota Motor and Sony, Japanese manufacturers have slashed idle production capacity and "non-regular" employment since November to drag their output back in line with demand.[21] In what's expected to mark the beginning of an upward swing over the next two months, Japanese output grew 1.6% between February and March. That's a tiny spurt, but it does represent the first time in six months that production has risen in Japan. That could mean that manufacturers are finally starting to take in orders and are firing up their factories once again.[26] JAPAN'S industrial production grew in March for the first time in sixth months, reinforcing hopes that the collapse of world demand for Japanese manufactured goods has bottomed.[21]
Industrial output in Japan rose in March for the first time in six months, according to government figures.[16] Japan has received some much-needed good news today after Government figures revealed a 1.6% rise in industrial output for March - the first such rise in six months.[43]
Industrial output increased 1.6 percent in March, the Ministry of Economy, Trade and Industry reported Thursday. It was the first rise after five straight months of losses.[27] Figures released for the month of March saw Japan lift industrial output by 1.6 percent, sparking signs of recovery from the world's second largest economy.[45]
In Thailand, industrial output fell again in March, as did exports and imports, showing government efforts to stabilize the economy had made little impact, unlike in some other Asian nations.[15]
Recent data on exports and factory output have sparked hopes that Japan's slump may be easing, even if prospects for a full recovery appear dim while the global economy remains weak, given Japan's heavy dependence on foreign markets.[14] Recent export data have supported hopes that Japan's slump may be easing, even if prospects for a full-fledged recovery appear dim while the global economy remains weak, given Japan's heavy dependence on foreign markets. Analysts note that Japan's economy saw plenty of false dawns during its so-called "lost decade" of stagnation and deflation in the 1990s.[3] Recent data suggested that export levels may be bottoming out, even if prospects for a full-fledged recovery appeared dim while the global economy remained weak - given Japan's heavy dependence on foreign markets.[36]
The assessment echoed similar sentiments Wednesday from the Federal Reserve, which said that while the economy is still receding, the pace of decline "appears to be somewhat slower" than the last time policy-makers met in mid-March. Any rebound in the U.S. would be critical for Japan, which had long relied on foreign sales of its cars and electronic gadgets to drive economic growth. Faced with an unprecedented collapse in global demand, the economy has been mired in its deepest recession since the end of the Second World War. Major exporters such as Toyota Motor Corp. and Sony Corp. have moved quickly to adjust by reducing shifts, suspending factory lines and announcing thousands of job cuts over the past few months. Their strategy may now be paying off as they move to replenish slimming stockpiles. [11] "The outlook for Japan's economy from fiscal 2009 through fiscal 2010 is likely to greatly depend on developments in overseas economies and global financial markets."[29] TOKYO, April 30 (Reuters) - Japan's economy is likely to start recovering moderately in the October-March second half of this financial year, the Bank of Japan said in its half-yearly outlook report on the economy on Thursday.[24] TOKYO -(Dow Jones)- Bank of Japan Gov. Masaaki Shirakawa said Thursday that he remains on guard against economic downside risks, and that the economy may pick up at a moderate pace in the latter half of fiscal 2009.[46]
Some economists welcomed the BOJ's latest forecasts. "Since the January forecast was a little too optimistic, this revision brought the overall figures to appropriate levels," said Takahide Kiuchi, chief economist at Nomura Securities Co. Although the economy could improve in the short term as early as the April-June quarter, Kiuchi predicted that a sustainable economic recovery is not likely until around the latter half of next year, following adjustments for excessive plant and equipment, as well as staffing levels.[6]
In the next fiscal year, Japan's economy should grow 1.2 percent, the BoJ predicted.[13] The board said Japan's gross domestic product, a broad measure of economic output, is expected to shrink more than 3 percent for the 2008 fiscal year, which ended March 31.[27] For the next fiscal year that begins April 2010, the bank said Japan's gross domestic product would mark a 1.2-per-cent growth.[19]
For fiscal year 2010, the BOJ expects to see a gain of 1.2% in real GDP, though that is lower than the 1.5% growth forecast in January.[5] The BOJ board expects the downward movement to continue through the 2009 fiscal year, with another 3 percent drop before rebounding in 2010 with up to a 1.5 percent gain.[27]
Household spending in the world's second largest economy fell 0.4 percent in March, as the government predicted unemployment could rise to 5.2 percent in the next fiscal year.[27] TOKYO, Japan (CNN) -- Unemployment in Japan rose to 4.8 percent in March, its highest level in four years and a nearly half-point rise from February, the government reported Friday.[27]
TOKYO (MarketWatch) -- Japan's factory production rose 1.6% in March, a larger increase than had been anticipated, the Ministry of Economy, Trade and Industry said in a preliminary report released Thursday.[44] The Ministry of Economy, Trade and Industry, which compiled the figures, called production levels "sluggish," noting that output was down by a third since last March.[26]
Naoki Murakami, chief economist at Monex Securities, offered: "The dawn is breaking in the Japanese economy. "Production has hit bottom," he added, and predicted that, by May, output would recover to its January level.[36] "Japanese industrial production is turning the corner at a high speed," said Masayuki Kichikawa, chief economist at Bank of America Securities-Merrill Lynch in Tokyo. "These figures should serve as strong evidence that the economy is on a recovery track."[11] Junko Nishioka at Royal Bank of Scotland said in a note that "factory production appears to be getting close to the bottom". Japanese companies also forecast that industrial production would rise further this month and next, as they step up production to make up for large inventory reductions made previously.[1] The figure marks a turnaround from February's 9.4 percent plunge and January's record 10.2 percent tumble, pointing to an emerging recovery for Japan's factories. The government predicts industrial production will rise 4.3 percent this month and climb 6.1 percent in May.[35]
Industrial production in Japan rose by 1.6% in March from a month earlier, boosting hopes that the country's production and exports would recover after a sharp economic recession. Japan's downturn was caused mainly by a slump in foreign markets as worldwide demand has fallen for its cars and high-tech electronics.[37] The industrial production data for the 2008 fiscal year that ended March 31 marked a record 12.7-per-cent fall, the first drop in seven years.[33] The ministry's data also showed that industrial production for the month was down 34.2% from a year earlier.[44]
The latest industrial production numbers from Japan might just indicate that the world's second-largest economy is slowly turning around.[26]
The Bank of Japan has issued a downbeat report on the country's economy and reduced forecasts for growth.[28] In January, the central bank predicted the worst negative growth in the postwar era. As the economic recession deepened, the central bank revised its forecast downward.[42]
Central bank data on Thursday showed exports fell 22.7 percent in March from 2008, after a drop of 11.1 percent in February.[15] In fiscal 2008 ending on March 31, Japan's auto output plummeted 15.2 percent year-on-year to 9,993,756 units while exports slumped 17.2 percent to 5,602,813 units, said the industry body.[17] Analysts had forecast a gain of 0.8 percent for March, so the 1.6 percent rise has doubled expectations. Japan suffered when global demand for their cars and electronics goods dropped, negatively affecting factory output.[45] The rise in monthly output, the BOJ's optimistic outlook and last night's surge on Wall Street, when the Dow Jones industrial average rose 168.78 points to 8,185.73 on the U.S. Fed's upbeat economic forecast, lifted Japan's Nikkei by 334.49 points to 8,828.26.[22] The BOJ sounded a warning about deflation as it projected a 1.5 percent contraction in the consumer price index, excluding volatile fresh food prices, up from the previously predicted 1.1 percent fall. In its biannual economic report entitled "Outlook for Economic Activity and Prices," the BOJ said, "Economic conditions in Japan have deteriorated significantly."[17] The report says: 'Economic conditions in Japan have deteriorated significantly' In the corporate sector, exports have decreased significantly due to a sharp downturn in overseas economies, and business fixed investment has also declined substantially, reflecting the deterioration in corporate profits and financial conditions.[28] 'Economic conditions in Japan have deteriorated significantly,' the bank said in the report.[19]
"But the level of output is still very low and some of the rebound is relying on various economic packages. ''It's not clear how much output will recover from now." The Aso Government this week introduced to Parliament a Y14.7 trillion ($205 billion) public spending and tax reduction package intended to stimulate Japan's tentative recovery signals. The ministry's indexes clearly show that the mild improvement in manufacturing conditions is mostly attributable to the rapid rundown of inventories -- both materials and finished products -- rather than improved market conditions.[21] An emerging economic recovery in China -- Japan's largest trading partner -- as well as Tokyo's fresh stimulus spending of about 150 billion dollars are expected to help arrest the economy's decline.[3] Recently approved Japanese stimulus spending of more than $150 billion is expected to help slow down the country's economic decline. The Japanese government announced earlier in March that it would spend this amount, which is more than anticipated, to stimulate the economy.[37]
The shrinkage is in line with the expected contraction for the 2008 financial year, which finished at the end of March. Japan has the world's second largest economy behind the U.S., with its GDP measured at $4.844 trillion (3.266 trillion) by the CIA World Factbook in 2008.[23] Japan's export-driven economy suffered a brutal annual contraction of 12.1 percent in the last three months of 2008. Analysts say this year's first quarter could be even worse.[2]
Manufacturers forecast further gains in production in the coming months, suggesting output may be bottoming out after the sharpest decline on record in the first quarter of the year.[34] Production was expected to rebound a further 4.3 per cent in April and 6.1 per cent in May, according to manufacturers' forecasts.[36]
The bank expected a consumer price index to fall 1.5 per cent in the current fiscal year.[19]
The outlook offered further reason for optimism. Factory output - pivotal in this export-oriented economy - is projected to rise 4.3 per cent this month and another 6.1 per cent in May.[11] Though it was the first rise in six months, the result also marked the second consecutive improvement in the monthly reading - although output fell 9.4 per cent in February, that was better than the record 10.2 per cent drop in January.[36] A 10.3 per cent rise in electronic components output and a 5.6 per cent increase in general equipment led the overall rise.[36]
Output was down 34.2 per cent in March, compared with levels from 12 months ago.[36] Inventories dropped 3.3 per cent in March in the third consecutive monthly decline, while shipments grew 1.4 per cent. Other recent economic figures contain glimmers of hope.[11] Shipments improved 1.4 per cent in March, again the first upward movement in six months, but the inventory index shrank by 3.3 per cent.[21]
The proposal calls for a record 15 trillion yen ($155 billion) in government spending, equivalent to about three per cent of Japan's gross domestic product.[11] The monthly industrial production gains represent a marked turnaround from February's 9.4 per cent plunge and January's record 10.2 per cent drop.[11] Stocks rose after the industrial production report. The Nikkei 225 Stock Average climbed 4% at 2:03 p.m. in Tokyo, taking its gains to 25% since the benchmark reached a 26-year low on March 10.[18] Preliminary Japanese industrial production for March rose 1.6% m/m compared to expectations for a 0.8% gain and the previous month's 9.4% decline.[40]
The Japanese government early Thursday said industrial output rose 1.6% in March, double the 0.8% gain that economists had expected.[47] Economists surveyed by Bloomberg News had expected a milder 0.8% increase in Japan's March industrial output.[44]
After tumbling sharply since last year, industrial output edged up 1.6 percent in March from February — the first increase in six months.[29] South Korea's industrial output rose a seasonally adjusted 4.8 percent in March from February, data showed, beating expectations for a 2.7 percent rise.[15]
According to a government study, Japanese manufacturers expect industrial output to rebound a further 4.3 percent in April and 6.1 percent in May.[37] A manufacturing survey conducted by the Ministry of Economy, Trade and Industry shows that manufacturers expect output to rise 4.3 percent in April and 6.1 percent in May.[45]
"The Japanese economy is likely to see a division in 2009 that puts manufacturers in the 'winners' circle' and households and non-manufacturers in the 'losers' camp," said Barclays Capital economist Kyohei Morita. "As a result, the economy is likely to show an 'L-shaped' recovery with business sentiment diverging by industry," he added.[3] Kyohei Morita, chief economist at Barclays Capital in Tokyo, said while brighter days may be ahead for manufacturers, other sectors of the economy will likely remain weak. Non-manufacturers and households could get a temporary reprieve from planned government aid, he said, but they will still be on the losing end of the economy.[11]
Fuelling those hopes were fresh reports Thursday from the government and central bank indicating the worst may be over for the world's second-largest economy.[11] "As the central bank, we will make every effort to get the economy back on to a recovery path."[46]
The central bank said private consumption recovery would possibly remain sluggish for the projection period, given the improvements in the employment and income situation tend to lag behind any recovery in corporate profits. Commenting on the inflation environment, the central bank expects a 1.5% decline in the CPI excluding fresh food for this fiscal, larger than the 1.1% decrease estimated in January.[38]
Speaking to reporters following the decision, BOJ Governor Masaaki Shirakawa said the central bank sees very little risk of Japan falling into a deflationary spiral and said that the current level of BOJ bond purchases is appropriate.[40] Since cutting the key rates in December, the Japanese central bank has been buying corporate debt and stocks to ease the cash crunch. It has also increased monthly purchases of government bonds to 1.8 trillion yen.[18] The Policy Board of the central bank unanimously voted to hold the uncollateralized overnight call rate at 0.1%.[38]
Earlier in the day, the BOJ's policy board voted unanimously to keep interest rates unchanged at 0.1%, saying it wants to first gauge the effectiveness of other measures it has recently adopted before considering any further policy changes. The BOJ Thursday also downgraded its ecomonic growth outlook to a 3.1% contraction - a record-low level.[46] "The BOJ is buying long-term government bonds to achieve its monetary policy goal, which is to realise sustained economic growth with price stability. From this perspective, we are buying bonds at the current level. "Trust in monetary policy will be lost if the BOJ buys government bonds for purposes other than monetary policy, such as to monetise government debt, or even if markets view our bond buying as aimed at monetising debt. That will have a negative impact on long-term interest rates." Asked if there is room to review, or implement more flexibly, the BOJ's self-imposed rule of capping its government bond holdings to the level of yen notes in circulation: "In implementing monetary policy we will carefully examine economic and price conditions without any preset ideas in mind. I believe it's wrong to rule out in advance any policy option and that it's equally wrong to say the BOJ will adopt a certain measure for sure.[10]
"While big companies see the light at the end of the tunnel as output shows signs of a recovery, small firms are still suffering from the economic gloom," said Yasuhide Yajima, senior economist at NLI Research Institute. "The BOJ may stick to its year-end recovery scenario but will probably need to ease monetary policy further down the road."[9]
Recently, signs of a leveling out of economic activity are beginning to be seen globally against the backdrop of progress in inventory adjustments, and authorities in countries around the world are planning, or have already begun, to implement large-scale policy measures, which are expected to bear fruit in the near future. It is still not certain, however, whether these developments will lead to a steady recovery of the world economy.[24] Projections regarding the world economy need to take into account how the restructuring of the U.S. and European financial systems is likely to proceed and how rapidly demand around the world, including that in emerging economies, is likely to recover. Due consideration has been paid to the uncertainties surrounding these issues in assessing the baseline scenario as well as risks to the outlook for Japan's economic activity and prices as detailed below.[24] The BOJ said a steady recovery of the world economy is still uncertain and that projections need to take into account process of the U.S. and European financial restructuring and the pace of recovery in the global demand.[29] The recovery, said BOJ Governor Masaaki Shirakawa, is highly dependent on developments in overseas economies and global financial markets. "It's still highly uncertain how the restructuring of the U.S. and European financial systems is likely to proceed and how rapidly demand around the world, especially in emerging economies, is likely to recover," Shirakawa said at a press conference after the policy meeting.[17]
As firms' earnings and financial conditions suffered from the global economic downturn, companies cut spending and the unemployment rate rose. [19] The report pointed out that weakening corporate earnings and financial conditions have caused significant cuts in capital investment, and worsening employment and income conditions have sharply discouraged consumer spending. Other economic figures also added blueish tint to the already bleak prospect for the economy.[17]
The bank's report "suggests the BoJ thinks the economy is near a bottom, but is cautious on the speed of recovery," said Macquarie Securities economist Richard Jerram.[14] "A full recovery in Japan requires strong exports, particularly to the United States. Unless we can see a recovery in the U.S. economy, it is too early to say Japan's economy is back on track," he said.[3] The Bank of Thailand said the economy would shrink up to 3.5 percent in 2009, with exports falling 27.5 percent.[15]
Production is also projected to rise in April and May. It was much-needed good news for an economy that has been pummeled by a debilitating global slowdown and is now in the midst of its steepest recession since World War II.[29] "Exporters are rebuilding inventories on the basis of expectations for shipments," said Dwyfor Evans, a strategist at State Street Global Markets in Hong Kong. "This is a little bit uncertain because if new orders remain at relatively low levels you'''re not going to see a sharp rebound in production."[47]
Many manufacturers have shut down production in the weeks leading to the May 1 "Golden Week" holidays, reducing inventories. Shirakawa believes they will increase industrial output during the next three months. "We would not be surprised to see double-digit growth in the next month," he said. Whether this will be a sustained growth, however, depends on U.S. consumers. [27] The numbers suggest manufacturers anticipate an increase in production in the month ahead. "That is probably the most important data we're seeing, because that's a reading of what manufacturers anticipate," said Hiromichi Shirakawa, chief economist of Credit Suisse Japan.[27]
Japan's economic downturn was caused almost entirely by a slump in foreign markets. As consumers overseas stopped buying Japanese products, companies slashed their production to reduce a glut of unsold products. Now some firms, such as automakers, are starting to gradually increase output again.[3] Healthy production growth rates are also tied to the trade balance, which has been teetering as Japan weathers an overly robust yen that has made it expensive for foreign buyers to purchase Japanese goods.[26]
From here you can use the Social Web links to save Japan's industrial production begins to grow to a social bookmarking site.[21] 'Industrial production in the April-June quarter will be quite strong, but it is difficult to expect it to continue to rise after that. Industrial production depends on final demand and exports, and there are still doubts about those two areas.[34] The rise followed a record 10.1 percent fall in industrial production in January and a 9.4 percent drop in February.[34]
Looking ahead, production is expected to increase by 4.3% in April and to rise by 6.1% in May, according to manufacturers surveyed by the ministry.[44] Given manufacturers forecast increases in April and May, we can say production is recovering, at least temporarily, from excessive falls in the past few months.[34]
Output is expected to rebound a further 4.3 percent in April and 6.1 percent in May, according to manufacturers' forecasts.[3]
Singapore's unemployment rate rose to the highest in more than three years in the first quarter, but manufacturers are turning less bearish on prospects for the next six months. [15] Japan's manufacturers have also been hit by a stronger yen, which has spent most of the year below 100 yen per dollar.[7]
Asked about Japan's biggest banks reporting big losses for the year ended March 31, Shirakawa said: "Losses at the financial institutions can be absorbed fully." "Stability in Japan's financial system overall has not been hurt," he told a news conference.[48] TOKYO, April 30 (Reuters) - Bank of Japan Governor Masaaki Shirakawa said on Thursday that Japanese corporate funding conditions were gradually improving, although they was still severe.[48] The bank's policy board voted unanimously at a one-day meeting to forego another rate hike as Japan suffers from the worst recession in the postwar era.[41] The decision by the Bank of Japan's policy board was unanimous, it said in a brief statement.[4]
Earlier today, the BOJ's policy board voted to keep interest rates unchanged at 0.1% as expected. [5]
Consumer spending was sluggish in Japan even before the recession and rising unemployment is expected to make people even more cautious about splurging. Another worry is that companies are reducing their business investment, which has been another key driver of the economy.[3] The world's second-largest economy entered a severe slump last year as consumers around the world stopped buying Japan's cars, high-tech gadgets and other goods, but analysts say there are signs that it may be through the worst.[3] The announcements complete a week of conflicting indicators about the health of Japan's economy.[27]
From here you can use the Social Web links to save Rise in Japan industrial output signals crisis easing to a social bookmarking site. [36] Japanese industrial output in March has grown again after a decline of more than one-third over the last six months, government figures show.[37] The March increase follows a 10.1% decline in Japanese industrial output in January and a 9.4% decline in February.[44]
Export-sensitive manufacturing output shrank by 15.4 percent in March from a year ago, the fourth straight month of double-digit percentage falls. [15] Factories boosted production by 1.6 percent in March compared with February, after a plunge of around one third since September.[3]
Analysts also cautioned that the ministry's March IP index showed the world's second-largest economy still running at only the 1983 level.[21]
The announcement was warmly welcomed by Japanese investors with the benchmark Nikkei share index closing Thursday up by almost four per cent, buoyed also by a strong day on Wall Street.[12] Investors welcomed the positive data, and the Nikkei 225 Index soared 3.5 per cent in early trade.[36]
MAY Day could usher in a month of campus strikes as universities resist union demands for a 20 per cent pay increase.[36]
The increase is the first for six months. In good news for the Asian powerhouse, exports have risen since the beginning of this month although shipments are still only half what they were 12 months ago. [45] "A full recovery in Japan requires strong exports, particularly to the United States," Hiroshi Watanabe, an economist at Tokyo's Daiwa Institute of Research told reporters.[12]
Japan's factory output has risen for the first time in six months, raising hopes that the country's worst recession since World War Two may have bottomed out.[12] Output rose for the first time in six months, adding to evidence the worst of the recession may be over.[47]
According to the forecasts made in January, decline in fiscal 2009 was seen at 2% and growth for 2010 at 1.5%. [38] In fiscal 2008, the BoJ forecasts that real GDP will shrink 3.2% compared to a 1.8% decline estimated in January.[38]
The economic growth rate for fiscal 2008 seems likely to have deviated substantially downward from the interim assessment conducted in January. [24] Earlier Thursday, fresh economic figures revealed that Japan's struggling manufacturers are showing signs of life.[29] The Bank of Japan announced Thursday that it has organized a "swine influenza response team" headed by Gov. Masaaki Shirakawa to "gather relevant information" and ensure that it is able to "continue providing essential central banking services under evolving conditions."[11]
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38. RTTNews - Latest Earnings,Upcoming Earnings, Pos Pre Announcements, Pos Pre Announcements , Positive Surprises, Negative Surprises, Hot Stocks, Stock Split Calendar, Stock Buybacks, Dividends, Negative, Positive PreAnnouncements,Surprises .
39. Japan's Economy to Contract 3.1% in 2009 Fiscal Year, BOJ Says | CEP News
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