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Japanese Factory Output Continues To Improve

Industrial production rose for second straight month as factories continued to recover after the sharp downturn from the earthquake and tsunami.

TOKYO (AP) -- Japan's industrial production rose for a second straight month as factories continued to recover after the sharp downturn from the March 11 earthquake and tsunami, the government said Wednesday.

Industrial output rose 5.7 percent in May from the previous month, according to the Ministry of Economy, Trade and Industry report. In April, production was up 1.6 percent.

The May production numbers were lower than the government's rosier forecast of 8 percent rise for the month.

Still, the improvement adds to signs that the world's No. 3 economy is rebuilding after the disaster damaged factories and disrupted manufacturing supply chains. Industrial production plunged a record 15.5 percent after the earthquake and tsunami devastated Japan's industrial northeast, crippled a nuclear power station that continues to leak radiation and caused widespread power shortages.

While factory output was still below pre-quake levels in May, the ministry upgraded its assessment of industrial production, describing it as "on a recovery trend."

The ministry measures output using an index, with 100 representing the 2005 base. May's seasonally adjusted level stood at 88.8, compared with 97.9 recorded in February, before the earthquake.

Sectors that drove the expansion include transport equipment, general machinery and chemicals.

Production figures released by automakers Tuesday indicated improving conditions, with Nissan Motor Co. posting year-on-year output gains in Japan and overseas.

Chief Executive Carlos Ghosn said earlier this week that production at his company has mostly recovered and will be back to normal by October.

The ministry forecast factory output to rise 5.2 percent in June and 0.5 percent in July.

Shipments in May grew 5.3 percent, and inventory rose 5.1 percent.

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