Japan Industrial Output Shrinks Less than Initially Thought

Japan’s industrial production fell 1.2% month-over-month in July 2025, less than the preliminary estimate of a 1.6% drop but reversing a 2.1% gain in the previous month. It marked the steepest decline since November 2024, weighed down by US trade uncertainty, soft demand, and continued weakness in key industries such as autos and steel. Output was sharply lower in motor vehicles (-6.7% vs 0.5% in June), production machinery (-6.3% vs 0.5%), and general-purpose and business-oriented machinery (-4.5% vs 1.6%). On a yearly basis, industrial output contracted 0.4%, swinging from a 4.4% rise in June, which had been the strongest annual growth since September 2022.