Japan’s factory output growth slows in Feb. as virus fallout widens
01 April, 2020
Japan’s factory output rose in February at a slower pace compared to the previous month, increasing growing signs that the rapidly spreading coronavirus pandemic is taking a toll on an economy already on the cusp of recession.
The data underscores the task Prime Minister Shinzo Abe faces in avoiding the virus outbreak from wiping out the huge benefits his “Abenomics” stimulus policies have taken to the economy.
Factory output rose 0.4% in February, government data showed on Tuesday, slower compared to the 1.0% gain in January but faster than the 0.1% increase forecast in a Reuters poll.
Manufacturers surveyed by the federal government expect output to fall 5.3% in March and increase 7.5% in April, the info showed.
Separate data showed retail sales rose 1.7% in February from a year earlier. The jobs-to-applicants ratio fell to at least one 1.45 in February from 1.49 in January, labor ministry data showed, marking the lowest level in nearly 3 years.
The new virus has infected more than 700,000 persons and killed about 35,000 around the world, while disrupting global trade, tourism and supply chains and prompting city lockdowns.
In Japan, a rise in domestic coronavirus cases has stoked worries of tougher social distancing restrictions, while a decision to postpone the Tokyo Olympic Games threatens to push the fragile economy into recession.
Abe has pledged an enormous stimulus package that might be bigger than one launched during the global financial crisis to cushion the outbreak’s hit to growth.
Automakers like Toyota Motor have announced factory shutdowns around the world, including at domestic plants, because of slumping demand and supply chain disruptions.
The world’s third-largest economy shrank an annualized 7.1% in the 90 days through December because of the hit from last year’s sales tax hike and the U.S.-China trade war.
Analysts expect the economy to contract again in the first quarter, meeting the technical definition of a recession.
Japan’s government the other day offered its bleakest assessment on the economy in nearly seven years, saying conditions in March were “severe” as the coronavirus pandemic turn off factories and cooled consumption.
Source: the-japan-news.com
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