Japan’s Production and Retail Sales to Plunge Shapely in April

Japan’s Production and Retail Sales to Plunge Shapely in April

According to Reuters compiled data, Japan’s factory production and retail sales tend to fall at the fastest pace in years in April, causing by the coronavirus outbreak.

Japanese goods demand both domestic and overseas shrunk after the world has put in lockdown and several countries introduced a restrictive measures to prevent virus spreading, leading to a disruption on supply chain, which have a tendency of placing economy into recession in the current quarter.

Industrial output estimated to fall by 5.1% in April, compared to the month earlier, the biggest drop since comparable data became available in 2013, Reuters reported on statement.

While retail sales would plunge 11.5% in April YoY, the fastest pace of decline since March 1998, after a revised 4.7 decline in March.

 “The government issued the emergency status in April due the expansion of the coronavirus impact and overseas economic activity stagnated, which likely pushed down productions of durable goods and capital goods,” said Yusuke Shimoda, senior economist at Japan Research Institute.

The unemployment rate rose to 2.7% in April from 2.5% in March.

“Business conditions worsened significantly in areas such as accommodation, transportation, restaurant and entertainment. Labour demand has also receded,” said Takeshi Minami, chief economist at Norinchukin Research Institute.