Japan industrial production falls back into contraction

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Industrial output in Japan fell into contraction in March after just one month of growth as production of machinery and electronics declined.

The preliminary reading from the Ministry of Economy, Trade and Industry showed industrial production fell 2.1 per cent month on month in February, reversing from a rise of 3.2 per cent in February. A median poll of economists from Reuters had predicted a drop of 0.8 per cent.

The fall was driven by drops in output for machinery, down 6.3 per cent from a month prior, electronic parts and devices (down 4.8 per cent) and transport equipment (down 1 per cent).

The annual pace of production growth also slowed from the fastest pace in almost three years in February to 3.3 per cent in March, down 1.5 percentage points from a month earlier and missing a forecast predicting less marked deceleration to 3.7 per cent.

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