April 2023 Industrial Production

◆The April 2023 indices of industrial production declined for the first time in three months at -0.4% m/m, falling below market consensus (+1.3%, according to the Bloomberg survey). However, the majority of industries provided a positive contribution, hence performance was not as bad as overall figures suggest. The Ministry of Economy, Trade and Industry has therefore left its economic assessment unchanged at “Industrial Production shows signs of increase at a moderate pace.”

◆As for the future of industrial production, the indices are expected to continue moderate growth for the time being, with the pace of recovery expected to pick up in the summer. Recently there have been the competing influences of increasing production due to the easing up of supply constraints and shrinking overseas demand, but in the future, recovery production carried out by domestic automobile manufacturers and other industries, and demand for goods in China heading for a comeback are promising factors.

◆The April 2023 Indexes of Business Conditions are to be published on June 7, 2023, and the leading index is expected to be up by +1.8pt m/m to 99.5, while the coincident index is expected to do the same at +0.2pt to 99.0. Based on the predicted value, the assessment of the coincident index will automatically be left at “weakening.”