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Economy in Brief

Japan IP Slows Its Rate Of Decline... In Monthly Trends Only
by Robert Brusca April 30, 2009

There is actually a bounce in output in Japan this month as over MFG output rose by 1.6% in March. That bounce reduced the annual rate of decline of Japan’s output to a pace of -53.1% over three-months. So while the monthly gain seems impressive it is a gain amid some pretty colossal losses.

Despite the gain in output this month, a gain that is fairly widespread, all the sector three-month growth rates are showing an accelerated rate of decline compared to six month rates (or nearly the same pace). Even though the bounce is discernable on the chart above tit has not been strong enough to stabilize any trends in output. Over the past year output is down a stunning 35%. In the quarter output is falling at a 63% annual rate.

Still the slight turn up in output at the end of the quarter could be the start of turning these growth rates higher. The declines are at such a horrific pace that even this small upturn will make it likely that Q2 will show a slowing in the pace of the drop. Across Europe and in the US signs that the pace of contraction is being reduced are already more manifest than in Japan. Japan may be a latecomer to this trend but the pickup in monthly IP, despite the fact that data trends still swamp the gain, shows a significant boost that could be the start of Japan’s turnaround.

Japan Industrial Production Trends
  m/m % Saar % Yr/Yr Qtr-2-Date
seas adjusted Mar-09 Feb-09 Jan-09 3-mo 6-mo 12-mo Yr-Ago % AR
mining & MFG 1.6% -9.4% -10.1% -53.1% -53.6% -35.1% 2.5% -63.3%
Total Industry 1.3% -9.1% -9.3% -51.5% -52.3% -34.0% 2.5% -61.6%
MFG 1.7% -9.2% -10.3% -52.8% -53.4% -35.0% 2.7% -63.3%
Textiles -6.4% -5.6% -3.7% -47.6% -35.7% -25.2% -5.6% -39.7%
T-port 3.9% -25.0% -17.7% -83.1% -79.3% -57.0% 7.8% -87.7%
Product Group
Consumer Gds 1.7% -9.9% -6.4% -45.9% -45.1% -27.1% 2.5% -56.3%
Intermediate Gds 3.2% -9.3% -12.8% -55.6% -59.8% -40.0% 3.9% -70.1%
Investment Gds -2.6% -9.9% -7.3% -56.2% -50.8% -33.1% -1.9% -58.1%
Mining -3.6% -2.6% -2.6% -30.2% -20.1% -10.4% -2.7% -15.4%
Electric&Gas -0.5% -3.1% -0.8% -16.4% -13.0% -7.9% 0.7% -20.3%
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