ichi Life Research Institute. July's production is
expected to slip 0.2 percent, better than the 1.2 percent
drop projected a month ago, and August's output is expected
to rise 1.9 percent.
Also, the ratio of inventories to shipments decreased 3.8
percent on month, a sign that goods are being sold.
Cheered by the upbeat news, investors lifted the Nikkei
225 index 0.26 percent to 11,888.96 points, its highest
finish since April 8.
But not all the news this week was positive.
Spending by Japanese households headed by wage earners _
perennial weak spot in the economy _ rose a
smaller-than-expected 0.1 percent in June from a year
earlier. June's figure marked the first rise in three
months.
Wage-earner household spending is an important gauge of
personal consumption, which accounts for roughly 55 percent
of Japan's gross domestic product. Weak consumption has
long been blamed as a central factor in Japan's decade-long
economic slump.
Also, Japan continues to struggle with deflation, or
falling prices, with reports showing that Tokyo's core
consumer price index _ which excludes volatile food prices
_ fell 0.4 percent in July from the same month a year ago.
That extends a string of year-on-year declines dating back
to October 1999, the government said.
The nationwide core consumer price index, which the Bank
of Japan uses as a benchmark for its current ultra-easy
monetary policy, fell 0.2 percent in June from a year
earlier.