BOJ Warns Factory Output Lower in Q2

The Bank of Japan said it expects factory output to fall for the first time in three quarters in April-June on weak Asian demand, underscoring the fragile nature of the economic recovery.

Industrial production rose 1.5 percent in January-March from the previous quarter, helping the world’s third largest economy expand much faster than expected.

But the central bank offered a cautious view on the outlook for output, saying it may have briefly hit a soft patch as automakers see domestic inventories build up and steelmakers feel the pinch from sluggish Asian demand.

Industrial production will increase moderately reflecting domestic and overseas demand, albeit with some fluctuations,” the BOJ said in a monthly economic report released on Monday.

The central bank also warned there was “high uncertainty” on its forecast that output will rebound in the third quarter.

via Reuters

Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza