TOKYO (AP) - A fresh barrage of negative data on Japan's failing recovery Tuesday pumped up pressure for central bank action to help revive the world's third-largest economy.
Japan's industrial output contracted by 4.1 percent in September from August and 8.1 percent from a year earlier as automakers and steel mills cut production due to shrinking demand and antagonisms with China, according to the Ministry of Economy, Trade and Industry.
The economic recovery that followed Japan's March 2011 disasters has been doused by slowing global growth. Flaring tensions with China over disputed islands in the East China Sea have further crimped demand, especially for big-ticket items like cars. Slowing growth in China, meanwhile, has hit demand for industrial inputs like steel and machinery.
"Industrial production is on a downward trend," the ministry said, forecasting a further decline in October, followed by a rebound in November.
The central bank was meeting Tuesday, with many expecting it to expand its assets-purchasing program, aimed at catalyzing demand to counter slowing growth.
Embattled Prime Minister Yoshihiko Noda convened an extraordinary session of the legislature on Monday, appealing to the opposition Liberal Democratic Party to cooperate in passing a bill authorizing bond sales to finance the growing deficit.
Japan already leads industrial nations with government debt amounting to more than twice the country's gross domestic product. It now faces a "fiscal cliff" thanks to a standoff over the timing of the next elections, which is preventing issuance of 38.3 trillion yen (about $480 billion) in deficit financing.
"We still have work to do!" Noda said in a speech that repeatedly reminded lawmakers of their responsibility toward future generations. He warned that funding shortfalls threaten to affect crucial government services.
Noda's Democratic Party of Japan is struggling as the Liberal Democrats gain in power. He was obliged to present his policy speech Monday in the House of Representatives after the LDP, which controls the upper house of the parliament, blocked him from delivering the speech in that chamber.
Apart from the political mess, exports, usually a bright spot for Japan's economy, are faltering as the prolonged crisis in Europe crimps demand. Another problem is the persistent strength of the yen, which makes products made in Japan relatively more expensive in overseas markets.
Shipments of passenger cars dropped 12.6 percent in September from August and 13.2 percent from a year earlier, METI reported. Shipments of virtually all other products also fell.
Jobless rate figures for September likewise offered little encouragement, as the government reported the seasonally adjusted unemployment rate was 4.2 percent in September, unchanged from August.
The ratio of job offers to seekers fell to 0.81 from 0.83 in August, meaning there were 81 jobs for every 100 job seekers.