Japan's industrial production up by 6.8%

MUMBAI: There's some good news for Japan's manufacturing sector. The production plan survey has indicated a robust 6.8 per cent month-on-month growth in industrial production output in August.

Industrial production had fallen 0.4 per cent on-month in July, after rising 1.3 per cent in June largely due to earthquake impact in Niigata.

Meanwhile, shipments fell 1.2 per cent sequentially, the first decline in four months. Inventories fell 0.3 per cent, and the inventory-shipment ratio declined 1.6 per cent.

The Niigata earthquake in July had impacted the production badly. Riken Corporation, a major provider of auto parts, was effectively incapacitated for a while, causing many automakers to stop their production lines

The latest data shows that production of transportation machinery fell by a hefty 7.3 per cent on month in July.

Production and shipments in the electric parts and devices sector increased solidly in July, with its inventory-shipment ratio falling to the lowest level since September 2006.

The production plan survey pointed to an increase in output of electric parts and devices of 9.4 per cent in August. The plan survey also pointed to a robust 6.8 per cent increase in overall industrial production (followed by a forecast of a 2.5 per cent on-month decline in September)

The report suggests that manufacturing activity will likely hold up in the near term, with a solid increase in output likely in third quarter.