Grim data releases from Japan today are reflected in the tone and forecasts released by the Japanese central bank. Industrial production fell 3.6 per cent in the month to June, more than double forecasts and compares to a 2 per cent rise in May. Annualised it fell 4.1 per cent versus a 2.1 per cent drop in May, one of the lowest readings of the last 6 years. The Bank of Japan noted that risks to inflation and economic growth were skewed to the downside and admitted that its 2 per cent target for CPI was ‘out of sight’. Currently running at 0.5 per cent, it should reach 1 per cent growth this fiscal year and core CPI will to rise to 1.6 per cent in March 2022. GDP should grow by 0.7 per cent this financial year.
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