Overview
- Official data show industrial production rose 0.5% month‑on‑month in May, with machinery and some transportation equipment driving the gain.
- Manufacturers have shifted materials, rescheduled runs and increased purchases to work around shipping and crude disruptions, producing a modest rebound in capital‑goods output.
- Oil‑derived plastics remain deeply hit, with reports of polyethylene down about 27% and polypropylene down about 15%, and car exports to the Middle East fell roughly 90% in April.
- Prime Minister Sanae Takaichi has instructed the industry ministry to produce comprehensive energy‑resilience measures by the end of August while the government says it can secure crude through March 2028 via alternative procurements.
- The labour market is holding steady with a 2.5% jobless rate, but policymakers warn that stockpiling and higher input costs could fuel inflation and that officials are watching whether the manufacturing rebound is durable.