Investing.com - June witnessed a resurgence in Japan’s industrial production, marking an encouraging quarterly growth amid the country's steady economic revival.
The industry ministry reported on Monday that factory output saw a rise of 2% from May when it faced a decline of 2.2%. This exceeded economists' predictions which were set at around a 2.4% increase. The second quarter further showed promising signs with the index climbing by 1.3% compared to the first.
These figures indicate that the world’s third-largest economy is steadily recovering despite potential obstacles posed by international downturns. For the first time since July last year, Japan achieved a trade surplus as exports remained stable while imports dipped due to declining fuel costs.
In contrast, retail sales experienced a slight slump with data showing a decrease of 0.4% in June from May - this was less than analysts’ forecasted drop of about 0.7%. However, expenditures had increased significantly by nearly six percent compared to last year.
One driving force behind this surge in consumption has been attributed to foreign tourists returning to Japan whose spending abilities have been boosted due to favorable exchange rates caused by the weakening yen value. According to statistics released by the Japanese National Tourism Organization, overseas visitor numbers reached over two million last month – approximately seventy percent more than pre-pandemic levels.
Looking forward into July and beyond suggests that production levels are likely going hold steady near those recorded for June as car manufacturers stand poised for benefiting from anticipated increases in chip supplies—although export activities may be hampered due to slowing markets abroad.
Meanwhile, domestically within Japan, consumers face mixed financial prospects; wage growth continues but struggles against inflationary pressures outstripping pay rises consistently prove challenging for many households across Tokyo where recent inflation rates have been higher than expected according to reports issued on Friday.