Monday, August 31, 2026
0850 JST (2350 GMT/1950 EDT Sunday, August 30) The Ministry of Economy, Trade and Industry releases July industrial production, the outlook for August and September.
Mace News median: -0.6% m/m (range: -1.4% to +1.3%) vs. June revised to +1.9% from +1.3%; +3.6% y/y (range: +2.6% to +5.4%) vs. June revised to +4.9% from +4.2%
By Chikafumi Hodo
TOKYO (MaceNews) – Japan’s industrial output is expected to edge lower on the month in July amid a pullback from a relatively strong increase the previous month. Output is seen falling for the first time in four months, but it is expected to remain supported by gains in exports amid steady global demand, particularly for artificial intelligence-related products, backed by healthy underlying business sentiment around the world.
Some concerns over the outlook for the Japanese economy intensified after capital expenditure in the April-June quarter of gross domestic product came in below expectations, but domestic factory output is expected to maintain the uptrend that began in April. Although geopolitical tensions in the Mideast remain, production in the manufacturing sector has maintained its solid footing as global demand for AI-related products remains strong.
Industrial output is expected to fall 0.6% on the month in July, following a 1.9% increase in June, which was upwardly revised from 1.3%. On a year-on-year basis, production is expected to increase 3.6% in July after falling a revised 2.1% in June, marking the first rise in two months.
The Ministry of Economy, Trade and Industry maintained its assessment that industrial output was “taking one step forward and one step back.” The last change was made in the July 2024 report, when it upgraded its view. The ministry’s forecast index showed that July output, adjusted for upward bias, will fall 0.7% on the month, while August output will rise 4.5%.
June output was revised upward, while the food and tobacco industry was added to the list of industries posting increases, bringing the number to 14 out of 16. In addition to food and tobacco, production machinery, such as chipmaking equipment, and electrical and information & communication machinery, including equipment used to make laptop computers, posted solid gains.
The uptrend in industrial output is underscored by record-high July exports, which were announced earlier this month amid robust semiconductor-related demand and strong automobile exports. Japanese exports increased for an 11th straight month in July, led by strong global demand. Exports to the U.S. have increased for five straight months, led by automobiles, even as the country has imposed stiff tariffs since February last year.