July industrial output fell 0.4 percent from June, down for the second consecutive month, due to slow demand for electric and machinery products, according to a preliminary report released Friday by the Ministry of Economy, Trade and Industry.
The seasonally adjusted production index at mines and factories came to 96.2 in July against a 100-point benchmark established in 1995.
The ministry attributed the decrease in the output to delays in the production of liquid crystal components and decreased demand for personal computers, automotive parts and wrapping machines for food makers.
However, the ministry kept its overall assessment of output trends unchanged from June, when it upgraded its view for the first time since April to "a slight rising trend."
"As the size of the drop was small, the (upward) trend is not changing," a ministry official reckoned.
"In addition, we expect to see an increase in August. (But) we need to be cautious (of future trends), as concerns over the U.S. economy are continuing."
The ministry said it predicts industrial output will jump 4.5 percent in August on a month-on-month basis as production of electronic devices and automobile exports are thought to be thriving. But it forecasts that output will fall 2.5 percent in September.
Shipments for July dropped 0.6 percent from the previous month, down for the second consecutive month.
The seasonally adjusted index of shipments stood at 98.5.
Inventories for July rose 0.6 percent on a month-on-month basis, the first increase in two months. The seasonally adjusted index came to 88.
The seasonally adjusted index for inventory ratio -- inventories divided by shipments -- dropped 3.7 percent from June to 97.6, marking the first decrease in two months.