2025.09.1204:30:00UTC+00Japan's Capacity Utilization Inches Toward Recovery in July 2025

Japan's economic activity shows faint signs of improvement as the latest capacity utilization figures, released on September 12, 2025, indicate a slight narrowing of decline. In July 2025, the country's capacity utilization index decreased by 1.1%, a modest improvement over the 1.8% drop recorded the previous month.

This month-over-month comparison, which assesses changes from June to July, underscores the persistent challenges that Japan's manufacturing sector faces in its quest for recovery. The data, although still in negative territory, suggests potential stabilization at the start of the second half of the year.

While this marginal adjustment towards a better capacity utilization figure offers some relief, economists remain cautious. Continuing efforts to navigate post-pandemic disruptions and shifting global demand will likely influence future trends. As Japan looks toward strengthening its industrial output, monitoring these subtle shifts will be crucial for policy-makers and investors alike. The coming months will be pivotal in determining whether this trend continues or if more robust measures are necessary to bolster growth.