Finance Matters

Posts Tagged ‘industrial output’

Japan’s industrial output recovered further last month after a record drop in March due to the earthquake and tsunami.

Disruptions caused by the twin disasters resulted in carmakers being forced to halt production as a result of parts shortages.

However, it looks as if the situation continues to improve after output rose by 0.8% last month compared with July, figures from the Finance Ministry showed today.

August represented the fifth consecutive monthly increase but was lower than analysts had expected.

However, the outlook remains uncertain as the yen continues to strengthen, and threatens the recovery of the world’s third largest economy.

A strong yen makes Japanese exports more expensive to overseas buyers.

The currency has been appreciating for some time as global investors see it as a safe haven at a time of economic uncertainty.

However, it has implications and it is forcing manufacturers to consider relocating and some have even suggested moving their operations overseas.

The Government announced it will continue to monitor foreign exchange traders’ positions in order to deter currency speculation – which is the latest intervention by the Government as it seeks to weaken the currency.

In related news this week, Japan’s retail sales slumped last month, which has led many analysts to question the strength of the recovery.

Retail sales fell 2.7% in August on an annual basis – much worse than the 0.6% expected by analysts.

In other news, Japan’s core consumer price index (CPI) rose 0.2% in August on an annual basis, and was up 0.1% compared with July, official data showed today.

Analysts had been expecting an annual rise of 0.1%.

In the meantime, the country’s unemployment rate fell to 4.3% from July’s 4.7% – forecasts were for the rate to remain unchanged.

In comparison, unemployment in the US stands at 9.1%, the UK’s rate is 7.9%, while in the euro zone, it is 10%.

Inflation in the world’s second largest economy eased last month after reaching a 3-year high in July.

According to the National Statistics Bureau, consumer prices rose by 6.2% in August on an annual basis, compared with 6.5% the previous month.

Several other economies throughout the world are battling with higher inflation, particularly in Asia, which are the result of soaring food costs.

A report published yesterday showed global food prices are hovering near an all-time high, according to the UN Food and Agriculture Organization (FAO).

The index hit a level of 231 points in August – a rise of more than a quarter compared with the same period a year ago.

Back in February, the index hit an all-time high of 238 points.

China’s Government has made several attempts to contain prices and it has previously said it will make reining in prices its top priority.

The People’s Bank of China has hiked interest rates several times in the last twelve months in a bid to tame inflation – measures which several other Asian countries have adopted.

Analysts now believe inflation has reached its peak and will fall back during the remainder of the year as policy measures take effect.

Inflation fears are always a concern to Chinese officials due to the potential for price rises to trigger civil unrest.

However, despite the fall in consumer prices, analysts still believe the Government needs to do more to contain rising prices.

According to one economist, the fall in inflation was attributed to a moderation in pork price rises.

However, the news lifted Asian markets with Hong Kong’s Hang Seng Index adding 0.2%, while the Australian ASX Index was 0.2% higher.

However, Japan’s Nikkei Index lost 0.3% after date revealed the economy performed worse than originally thought in the second quarter.

In the meantime, separate figures released today show Chinese industrial output rose 13.5% in August on an annual basis, albeit slower than July.

Japan’s industrial output recovered further last month after a record drop in March due to the earthquake and tsunami. Disruptions caused by the twin disasters resulted in carmakers being forced to halt production as a result of parts shortages. However, it looks as if the situation is improving for manufacturers after output rose at a [...]

Inflation in the world’s second largest economy reached the highest level in 34 months in May as food prices continue to rise. Consumer prices rose by 5.5% in May on an annual basis – higher than expectations of an annual rate of 5.3%. Food prices (the primary factor behind stubbornly high inflation) remain high, rising [...]

The Office for National Statistics has today revealed UK industrial output fell 1.7% in April – confounding expectations of a 0.1% rise. The fall was attributed to the extra bank holiday for the Royal Wedding and the impact of Japan’s earthquake and tsunami, which disrupted the supply chain. The fall represented the biggest since August [...]