Japan’s recession deepened last month as companies cut production, consumers spent less and fewer people looked for work.
Factory output fell 3.1 percent from September, when it rose 1.1 percent, the Trade Ministry said today in Tokyo. Household spending slid 3.8 percent, the eighth consecutive drop.
Companies surveyed said they plan the sharpest production cuts in 35 years as exports decline in the wake of the worst financial crisis since the Great Depression.
Looking at the year over year change in some of the components of Japan's Industrial Production, one can see the rapid decline in the production of consumer goods over the past few months, trailing similar declines seen in both construction and capital goods.
Specific areas contibuting to this decline according to METI (Ministry of Economy, Trade, and Industry were (in order):
- Transport equipment
- Electronic parts and devices
- General machinery
The Japanese economy is very dependent on exports, thus tends to be a decent barometer for global growth. This in itself, was expected, but troubling nonetheless. Back to Bloomberg:
Japan’s economy shrank last quarter, entering the first recession since 2001. The International Monetary Fund predicts the U.S., Europe and Japan will all contract next year, the first simultaneous downturn since World War II.
Data Source: METI