Wednesday, August 1, 2007

Japan Contracts For First Time In Four Years

by Stewart Douglas

Japan has announced a contraction in its manufacturing output over the course of July, according to figures published today.

A report released from Tokyo today showed a negative growth result for manufacturing within the Japanese economy, a rare occurrence after four years of consistent strength in manufacturing and export sectors.

The Japanese economy, which has performed well for decades, is seen as one of the world’s most resilient and efficient economies. The news announced today came as a surprise after four years of consistent manufacturing growth, reflecting the severity of the global economy as a whole.

Manufacturing across the globe lost strength over the course of last month, with only modest growth and widespread negative growth across manufacturing sectors.

Many other Asian economies have shown negative growth or sluggish growth over the course of July, perhaps indicating a wider global economic climate and the impact of tightening economies on company performance and investor confidence.

Despite contraction in Asia, China and India maintained on track for their predicted strong growth over the course of today, reflecting the opposite to general market trends.

The Eurozone also felt the slowest growth in over a year and a half over the last month, amongst the thirteen countries using the single currency within Europe.

With interest rates rising across the world in general, and tightening economies worldwide, growth is being suppressed within most major economies to keep on top of inflation, whilst maintain quality of life.

This will undoubtedly lead to panic on the stock exchanges, despite conflicting positive results from the US today which have seen shares grow and gain strength across industry.

Most Asian markets have shown a downturn over the last few days, which looks set to continue off the back of today’s news in manufacturing.

 

 

 

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