-Shinzo Abe, Japan's Prime Minister
Japan industrial production surprised to the downside in May, questioning the world's third biggest economy's ability to sustain a healthy growth pace in the second quarter. Total output of Japan's mines, manufacturers and utilities dropped 2.1% on month in May, according to the final data from the Ministry of Economy, Trade and Industry. Measured in annual terms, industrial output declined 3.9% in the reported month, compared with the 0.1% decrease in April.
Meanwhile, a survey of Japan's large-scale manufacturers showed that activity rose in the June quarter, adding to signs that the economy is in much better shape after last year's recession. The Bank of Japan's Tankan Manufacturing Index climbed to 15 in the June quarter from 12 in the first quarter. It was earlier last month that the Bank of Japan said that it would proceed with its bond buying programme to provide the liquidity required to underpin growth in the economy and help push inflation higher. Many analysts believe that the mixed economic data could push the Bank central bank to increase the quantum of its bond buying scheme in the near term which could be considered as a huge positive. At the same time, the IMF has recently said the risks to its Japan's growth outlook were skewed to the downside.
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