Spending Slump Leads to Japan’s July Output Missing Estimate

Industrial production in Japan rose less than expected in July while household spending slumped and the inflation rate remained unchanged, highlighting the challenge of reflating the world’s third-largest economy.

Output expanded by 0.2 percent from June, according to the trade ministry, less than the forecast for a 1.0 percent gain in a Bloomberg News survey of 31 economists. Consumer prices excluding fresh food rose 3.3 percent from a year earlier, the same pace as June, the statistics bureau said.

Today’s data underscores weakness in the economy following a sales-tax hike in April that’s hurting consumption. It also puts pressure on the government and Bank of Japan Governor Haruhiko Kuroda to consider adding stimulus to support the economy before another planned increase in the levy.

Bloomberg

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