Industrial production fell a seasonally adjusted 1.1 percent in July from the previous month as demand for vehicles and machinery items shrank after solid orders were placed in June, the Ministry of Economy, Trade and Industry said Wednesday.
The index of output at mines and factories registered 100.1 against the base of 100 for 2000. It logged a 1.6 percent rise to 101.2 in June, METI said in a preliminary report.
The outcome was worse than market expectations of a 0.5 percent drop in the index.
Despite the fall, the ministry kept its overall assessment of output unchanged for the 11th straight month, saying, "output tended to be flat."
A METI official said the production data continued to seesaw and the basic production trend has not deteriorated.
"The result is a contrast with the previous month, but we expect favorable data in August and September," he said. "As those figures are averaged out, we expect no major changes in the trend."
METI said manufacturers forecast a 2.3 percent rise in industrial production in August and another 2.3 percent increase in September.
The July industrial production posted declines as overseas demand eased for trucks and lithium-ion storage batteries for use in mobile phones and computers.