Japan upgrades economic outlook on factory output pick-up

Japan’s government has upgraded its view on the overall economy for the first time in eight months, noting a moderate recovery trend as factory output is picking up on the back of improving corporate activity.

In its monthly economic report, Tokyo also raised its assessment of production, corporate profits and sentiment, encouraged by further signs of an economic recovery from a recession unexpectedly caused by a sales tax hike last April.

However, the Japanese government maintained its views of private consumption and capital spending, saying that consumer spending held firm and business expenditures were largely flat, suggesting that a virtuous economic cycle is far from assured.