Industrial output marks first surge in two years

Japan’s industrial output rose 3.2 percent in fiscal 1999 from the previous year for the first time in two years, according to a preliminary report released Thursday by the Ministry of International Trade and Industry.

Boosted by information technology-related sectors, such as electric machinery, the index of production at the nation’s factories and mines registered 100.5 in fiscal 1999, as compared with the 100-point benchmark of 1995, after seeing a massive 7.1 percent drop in the previous fiscal year.

Shipments rose 3.4 percent to 102.5, also the first increase in two years, while inventory declined 2.7 percent to 91.1 for the second decline in a row.

Despite the overall rebound, some sectors, including textiles, remained sluggish.

In March, industrial output fell 1 percent from the previous month for the first decline in three months, falling back from a substantial rise in February due largely to the leap year’s extra day.

For this reason, the ministry has decided to maintain its December assessment that the nation’s production is modestly increasing.

The seasonally adjusted production index for the reporting month reached 104.3.

For April, MITI expects industrial production to fall by another 1 percent. But ministry officials said they expect the drop to be followed by a rebound of 1.3 percent in May.

Items showing weaker performance in March included ships, rolling stock, semiconductor production equipment and steam turbines for electric power industry.

Shipments were down 0.7 percent in March to 106.3, marking the first decline in three months. Meanwhile, inventory went up 0.7 percent, marking the third consecutive monthly increase, a trend attributed to stockpiling in anticipation of stronger shipments ahead.

Industrial production increased 2.8 percent in the January-March quarter to reach 103.9, marking the third consecutive quarterly increase.