Monday, 29 June 2009

Japanese industrial production rise in May

Japan's economy shows signs of returning to growth. AFP/CNA reports:

Japan's industrial output rose for a third straight month, matching the fastest pace in 56 years, as the world's number two economy claws back from its worst recession on record, data showed Monday...

Production rose 5.9 per cent in May from the previous month, matching April's revised growth, which was the strongest since a record 7.9 per cent increase in March 1953, according to the trade and industry ministry....

Output growth is expected to slow to 3.1 per cent in June and to 0.9 per cent in July, according to manufacturers' forecasts, the ministry said.

It is now a question of whether the rebound can be sustained.

Recent data have sparked hopes that the worst of the slump in exports and industrial production is now over, but analysts warn that any recovery is likely to be long and slow.

"Production was rebounding in a V-shape until June but will settle at a gradual rise from July," said Naoki Murakami, chief economist at Monex Securities...

The Bank of Japan's quarterly "Tankan" survey is expected to show an improvement in sentiment among Japan's major manufacturers from a record low the previous quarter, helping to underpin improving investor confidence.

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