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Japan’s industrial output collapses as exports dive

Currencies, Economic growth, Financial Events, Oil markets
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Japan has an ageing population. Since 1990, it has relied on exports to boost its economy.

Yesterday, official figures showed industrial production is now being badly affected by the global recession. Output fell 3.1% in October, and a 6.4% decline is expected in November.

Observers forecast the September – December period could see an “unprecedented” total fall of 12%. And unfortunately for the chemical industry, auto production was worst-hit last month.

A vicious cycle is clearly now underway, whereby lost exports will lead to major job cuts, and further reduce consumer spending. Japan’s economy minister, Kaoru Yosano, also warned this would increase “deflationary pressure on Japan’s economy”.