uploads///Japans Industrial Production Rose on Monthly Basis

Will Japan’s Rising Industrial Production Boost Its Economy?

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Mar. 21 2016, Published 9:33 a.m. ET

Industrial production

According to Japan’s Ministry of Economy, Trade, and Industry, Japan’s (EWJ) (DXJ) industrial production for January rose to 3.7%—compared to a fall of 1.7% in December. The data indicated that domestic and international demand increased in the economy. The economy is continuously facing stagnant growth and deflation. As a result, the rise in industrial production is a good sign for the economy. The industrial production index is a leading indicator of the country’s economy.

On a year-over-year basis, the index fell 3.8%. Over a one-year period, the industrial production always showed negative movement. In June and November 2015, it showed some improved figures of 2.3% and 1.7%, respectively.

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Japan’s machine orders increased

Japan machine orders also increased for January. It stood at 8.4% compared to the fall of 3.6% in December. On January 28, 2016, the Bank of Japan decided to move towards the negative interest rate zone to increase inflation and economic growth. Japan’s economic indicators showed some improvement. Japan’s major export-oriented stocks such as Toyota (TM), Honda (HMC), and Sony (SNE) gained 2%, 4%, and 24%, respectively, from March 1, 2016, to March 18, 2016.

In the next part of this series, we’ll analyze the performance of the US industrial production index.

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