Industrial output down 1.6% in November; METI downgrades its assessment of Japan’s regional economies

December 28, 2007
By Ken Worsley

Earlier today, the Ministry of Economy, Trade and Industry announced that Japan’s industrial output fell 1.6% in November. Last month, industrial production had increased 1.6% and hit an all-time high. What we found interesting in the ministry’s data was the projection that large manufacturers expect a 4% gain in production for December. This increase will apparently come on the back of increased orders for construction machinery.

Increased orders for construction equipment may seem surprising with the ongoing plunge in housing starts, but we’re expecting a boom in building to start sometime in the middle of next year. At any rate, with the decline in housing starts and high oil prices on its mind, METI also downgraded its assessment of Japan’s regional economies today, saying:

Conditions in regional economies are mixed although they are showing a moderate improvement trend as a whole.

This, of course, is meaningless fence-sitting. But what does mean something is the fact that METI minister Akira Amari made it clear that METI will be watching over larger firms to make sure that they do not attempt to bully smaller firms into not passing along the increased costs for raw materials. That sounds like a job that would require a serious number of regulators…

Filed Under Economic Reports, METI