Industrial output rose 1.4 percent in February from the previous month, snapping a three-month losing streak, as rebounding exports helped the auto sector, government data showed Friday.
The seasonally adjusted index of production at factories and mines stood at 102.5 against the 2015 base of 100, the Ministry of Economy, Trade and Industry said in a preliminary report. The result followed a revised 3.4 percent drop in January.
The transport sector was the biggest contributor to the index's rise due to increased production of passenger cars and auto parts. Output of machinery to produce semiconductors and liquid crystal displays was also robust in February, according to the data.
Still, economists say the rebound was rather modest after three straight months of fall, reflecting cautiousness among companies as the economic and business outlook remains uncertain at a time of prolonged trade friction between the United States and China.
The ministry maintained its assessment that output is "pausing" after downgrading it from "picking up slowly" in the previous month.
The country's economy has enjoyed modest growth, but recent data has raised the prospect that the current expansion phase may have ended late last year.
"Output may have bottomed out after sharp falls and given us some relief in that sense," said Toru Suehiro, senior market economist at Mizuho Securities Co.
"But companies remain cautious about ramping up production because they are not sure about the strength of the economy. As long as we see growth in exports and a relatively weak yen (against the U.S. dollar), production will likely hover around current levels."
Manufacturers polled by the ministry said they expect output to gain 1.3 percent in March and rise 1.1 percent in April.
The index of industrial shipments increased 1.8 percent to 101.6, while that for inventories was up 0.5 percent at 102.2.