Nervousness in Nippon as Recession Becomes Official

30 July 2001

Japan’s Ministry of Economy, Trade and Industry today announced that industrial production slipped by 0.7% during June, further eroding confidence in the nation’s ailing economy and heralding a slide into recession.

The data confounded local economists who had expected a decrease of only 0.4% after allowing for seasonal adjustments. Production of personal computers and IT-related products spearheaded the overall decline of 4% in the April-June quarter, following on from Q1’s 3.7% slippage. Two consecutive quarters of decline represent the formal definition of recession

But the downward trend could be about to reverse, according to the ministry’s survey of local companies. A further decline in output of 2.3% is predicted for July, whereas August is expected to reflect an increase of 3.4%

News source: Wall Street Journal