Data published by the Ministry of Economy, Trade and Industry (METI) showed that industrial production declined in December, which was due to a reduction in machinery production.
According to the report, industrial production fell by 1% in December after an increase by 7% in November. This was the first decline in the last three months. Economists had expected a 0.8% decline.
Meanwhile, in annual terms, the growth of industrial production slowed to 2.7% compared with 5.1% in November. Economists had forecast a 3.0% increase.
METI said that the drop compared to November was due to a reduction in the production of general-purpose equipment and production equipment, including equipment for the production of chips and engines used in production. Automakers were also under pressure, caused by a shortage of semiconductors. The data showed that in December, the production of cars and other vehicles increased by 1.5% after an increase of 43.7% in November.
Manufacturers surveyed by METI said they expect industrial production to grow by 5.2% in January and 2.2% in February.