Japan’s industrial output last month rose for the 11th straight month amid rising demand in China and elsewhere in Asia, while retail sales gained for the first time in nearly one-year-and-a-half. Another decline in consumer prices, meanwhile, cast a shadow over its economic recovery.
The 2.5 percent gain in factory output — a key barometer of Japan’s economic health — from December exceeded expectations. Kyodo News agency’s survey of economists forecast growth of 1.1 percent.
Industrial shipments last month rose 2.4 percent month-on-month, the Ministry of Economy, Trade and Industry said yesterday, led by general and electronics machinery. Industrial inventories expanded 1 percent.
“In general, production is recovering,” the ministry said in a statement.
Economists said rising demand in China and other Asian countries elped spur production of mainstay Japanese exports like cars and consumer gadgets.
“Industrial output grew in tandem with rising demand in China,” said Hiroshi Watanabe, economist at Daiwa Institute of Research.
“Japanese exports of vehicles and construction material to China underlined booming demand in the country,” he said.
China’s economic growth rose to 10.7 percent in the fourth quarter of last year. Recently, the country — Japan’s biggest export market — has been taking steps to curtail bank lending to cool down its economy to prevent overheating.
Japanese retail sales, meanwhile, rose 2.6 percent last month from a year earlier, the ministry said in a separate report. It marked the first year-on-year gain in 17 months since a gain of 0.7 percent in August 2008, ministry official Kazuhiko Manaka said.
Hideki Matsumura, a senior economist at Japan Research Institute, said retail sales were hit hard by the global economic slowdown after the collapse of US investment bank Lehman Brothers Holdings in September 2008.
A gain after the long downturn was not unexpected given increases in fuel prices and gains in auto sales spurred by tax incentives, Matsumura said.
In a sign of further worry for Japan’s economy, however, consistently falling prices failed to improve last month.
The nation’s key consumer price index, which excludes volatile fresh food prices, fell 1.3 percent from the year before, declining for an 11th straight month, the Ministry of Internal Affairs and Communications said. That matched a 1.3 percent decline in December.
Japan has been battling periods of deflation, or a steady decline in prices, since the 1990s. Deflation is a burden as it can hamper economic growth by depressing company profits, sparking wage cuts and causing consumers to postpone purchases. It can also increase debt burdens.
The core consumer price figure has improved in recent months, but Matsumura attributed that to gains in gasoline prices. The overall situation regarding deflation “has not improved at all,” he said.
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday obtained the government’s approval to inject an additional US$7.5 billion into its US subsidiary, the Department of Investment Review said in a statement. The department approved TSMC’s application of investing in TSMC Arizona Corp, which is engaged in the manufacturing, sales, testing and design of IC and other semiconductor devices, it said. The latest capital injection follows a US$5 billion investment for TSMC Arizona approved in June. The chipmaker has broken ground on two advanced fabs in Arizona with aggregated investments approved by the department totaling US$24 billion thus far. According to TSMC, the first Arizona
The lethal hack of Hezbollah’s Asian-branded pagers and walkie-talkies has sparked an intense search for the devices’ path, revealing a murky market for older technologies where buyers might have few assurances about what they are getting. While supply chains and distribution channels for higher-margin and newer products are tightly managed, that is not the case for older electronics from Asia where counterfeiting, surplus inventories and complex contract manufacturing deals can sometimes make it impossible to identify the source of a product, analysts and consultants say. The response from the companies at the center of the booby-trapped gadgets that killed 37
FRIENDLY TAKEOVER: While Qualcomm Inc’s proposal to buy some or all of Intel raises the prospect of other competitors, Broadcom Inc is staying on the sidelines Qualcomm Inc has approached Intel Corp to discuss a potential acquisition of the struggling chipmaker, people with knowledge of the matter said, raising the prospect of one of the biggest-ever merger and acquisition deals. California-based Qualcomm proposed a friendly takeover for Intel in recent days, said the sources, who asked not to be identified discussing confidential information. The proposal is for all of the chipmaker, although Qualcomm has not ruled out buying some parts of Intel and selling off others. It is uncertain whether the initial approach would lead to an agreement and any deal is likely to come under close antitrust scrutiny
SECURITY CONCERNS: The proposed ban on Chinese autonomous vehicle software and hardware would go into effect with the 2027 and 2030 model years respectively The US Department of Commerce today is expected to propose prohibiting Chinese software and hardware in connected and autonomous vehicles on US roads due to national security concerns, two sources said. US President Joe Biden’s administration has raised concerns about the collection of data by Chinese companies on US drivers and infrastructure as well as the potential foreign manipulation of vehicles connected to the Internet and navigation systems. The proposed regulation would ban the import and sale of vehicles from China with key communications or automated driving system software or hardware, said the two sources, who declined to be identified because the