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"Sluggish activity adds another headwind to the Bank of Japan's efforts to lift price pressures, and we still expect policymakers to announce more monetary stimulus at next month's meeting ".
-Capital Economics
Japanese industrial production went down continuing its sixth consecutive month of decline in May, as factories were highly affected by weak international demand and recent earthquakes near the country's manufacturing centre.
According to the data released by the Japanese Ministry of Economy, Trade and Industry, output dropped by 2.3%, highly below the expectations of a minor of 0.1% decrease. Meanwhile, previous data for output showed steep growth equalling 3.6% and 0.3% respectively in March and April. Compared to April, industrial production lost 2.3% after adding 0.5% the previous month. In the meantime, following data, namely weak reading on production, Wednesday's data on retail sales as well as weak export adds worries that Japan's recovery is rather gloomy despite steady rebound during the first quarter. Although Japanese Prime Minister Shinzo Abe has promised to introduce new package of stimulus this fall, some analysts are convinced that governmental support should come much sooner. Moreover, a growing numbers of economists believe that Japan's so-called "Abenomics" programme is relatively piecemeal to push the economy up.