An SMBC Nikko economist said Japan’s industrial production is likely to be supported by AI-related capital expenditure. Industrial output fell 1.7% MoM in August, a decline the firm attributed in part to automakers suspending operations at some plants amid earthquake and typhoon disruptions. The economist said oil supply uncertainty remains elevated, but Japan holds oil stocks equivalent to roughly 200 days of domestic consumption and has made progress securing alternative supplies, so the risk

An SMBC Nikko economist said Japan’s industrial production is likely to be supported by AI-related capital expenditure. Industrial output fell 1.7% MoM in August, a decline the firm attributed in part to automakers suspending operations at some plants amid earthquake and typhoon disruptions. The economist said oil supply uncertainty remains elevated, but Japan holds oil stocks equivalent to roughly 200 days of domestic consumption and has made progress securing alternative supplies, so the risk of a major oil supply shortfall appears low.