The economy ministry was also cautiously optimistic, saying that "industrial production has bottomed out and shows some signs of picking up."
TOKYO — Japan's factory output slowed in February, data showed Friday, highlighting the weak state of the world's third-largest economy and underscoring the size of the government's task in sparking sustained growth.
The unemployment rate also crept up last month while consumer prices again fell, showing the difficulty of reversing years of deflation that has crimped private spending and corporate investment.
Industrial production last month contracted 0.1% from January, marking the first month-on-month fall since November, although a survey of producers pointed to a pick-up in factory output for March and April.
The economy ministry was also cautiously optimistic, saying Friday that "industrial production has bottomed out and shows some signs of picking up."
The numbers come ahead of a Bank of Japan policy meeting next week as its new governor, Haruhiko Kuroda, talks up his plans to stoke the economy and reverse years of falling prices.
His vow to beat deflation, a mantra led by his boss Prime Minister Shinzo Abe, has stoked speculation that the BoJ will launch a new wave of aggressive policy measures that tend to weaken the yen, helping the country's exporters.
But "the markets' expectations of the new governor are so high that they will be almost impossible to meet, let alone beat, leaving the risks firmly skewed towards disappointment," said London-based Capital Economics.
Deflation is bad for the economy because it encourages consumers to put off spending in the belief goods will be cheaper in the future, softening demand and hurting producers.
