Japan Sees Retail Sales Down For Fifth Month As Virus Hit Deepens
Japan's factory output likely slowed in February and retail sales dropped for a fifth straight month, a Reuters poll showed on Friday, as the coronavirus outbreak took an increasing toll on businesses and consumers.
Japan has recorded 2,113 cases of the virus and 57 deaths so far as the disease races across the world, prompting the Bank of Japan to expand stimulus while the government works to nail down a support package that sources say will total at least €124 billion.
While the stimulus likely won't prevent the world's third-largest economy from sliding into recession, analysts say it could keep businesses afloat until global demand begins to recover.
Industrial output is expected to have inched up 0.1% in February from the previous month, the poll of 15 analysts showed, after a revised 1.0% gain in January.
"Domestic production activities probably didn't go as planned due to supply chain disruptions triggered by the coronavirus outbreak," said Takeshi Minami, chief economist at Norinchukin Research Institute.
"We expect factory output will fall 5% in March from the previous month and 2.0% in April on worries that declines in global demand will last longer due to the virus impact."
Next week's data also includes retail sales, which are expected to fall 1.2% fall in February from a year earlier, following a 0.4% slip in January.
"Retail sales for March will likely drop further not only in the service industry but also consumptions on other goods as the government called for people to refrain from going out to prevent the spread of the coronavirus," said Kenta Maruyama, economist at Mitsubishi UFJ Research and Consulting.
The trade ministry will publish both factory output and retail sales at 8:50 a.m. Japan time on Tuesday, March 31.