Japan industrial production dropped sharply by -5.4% mom in September, much worse than expectation of -2.4% mom. The seasonally adjusted index of production at factories and mines dropped for the third straight month to 89.5, against the 2015 100 base of 100.
But looking ahead, the Ministry of Economy, Trade and Industry said output would bounce back by 6.4% in October, and then 5.7% in November, based on a poll of manufacturers. An official said, “output may have hit bottom in September since economic activities have been returning to normal in countries such as Vietnam and Malaysia since late September, and a recovery is expected, mainly in the auto industry.”
Also released, unemployment was unchanged at 2.8% in September, matched expectations. Housing starts rose 4.3% yoy, versus expectation of 7.5% yoy. Consumer confidence dropped to 39.2, below expectation of 40.4. In October, Tokyo CPI core was unchanged at 0.10% yoy, below expectation of 0.3% yoy.
