TOKYO, Reuters – Japan’s April factory production likely dropped in April due to strict COVID-19 restrictions in Shanghai and other Chinese industrial centers.

The median polling of 18 economists found that Japanese industrial production fell 0.2% in April compared to March.

It would also mark the beginning of a decline from January. This follows an increase in March by 0.3%.

Economists at SMBC Nikko Securities stated that China’s lockdown slowed down exports. This likely had an impact on (Japanese), production especially in the general and electrical machine sectors with higher China-export exposure.

Automobile manufacturers, Toyota Motor (NYSE) Corp. and Mazda Motor Corp (OTC) Corp. were also forced to reduce domestic production due to strict controls to stop the spread of coronavirus in China.

Analysts said that the Chinese anti-COVID control has created a new downside concern for Japanese producers this summer. It will increase supply bottlenecks as well as raise raw material prices.

A poll revealed that April retail sales rose by 2.6% in comparison to last year. It was the second consecutive month with an increase, thanks to COVID curbs being lifted fully in March.

Industry ministry data will be released on May 31st at 8:50 am (May 30th at 2350 GMT).

The Japan unemployment rate was 2.6% in April, while the jobs-toapplicants ratio rose 0.01 to 1.23 according to the poll. Data on jobs are due May 31st at 8:30 AM (May 30th at 2330 GMT).