Japan's monthly industrial output dropped 0.7 percent in May from April, marking a decline of two straight months due to stagnant plant and equipment investment, according to a preliminary report issued Tuesday by the Ministry of International Trade and Industry.
The seasonally adjusted index of industrial production came to 95.5 against a 100-point benchmark set in 1995.
General-purpose steam turbines, skin cosmetics and books contributed most to the IIP decline in May, the report says.
The shipment index reached 97.4, up 1.0 percent and marking the first increase in two months, thanks to sound performance by items such as personal computers, automobiles and rolling stock.
The inventory index dropped 0.5 percent to 96.7, marking a decline of three consecutive months. Declines in automobile exports to North America, minicars and color TVs are among the greatest contributors.
The index of inventory-shipment ratio reached 106.9, up 0.8 percent from the previous month.
Although inventory adjustment is under way and industrial production is showing signs of touching bottom, the trend of final demand is opaque and therefore must be watched closely, MITI said.
Industrial production is expected to post a rise for June but to descend again the following month, officials said, noting there's no convincing factors to determine recovery.