Japan factory output bounces, easing pressure on BoJ

Japan's factory output unexpectedly rebounded in September, data showed Thursday, tempering expectations the central bank would unleash more stimulus after a string of weak data from the world's number three economy.

Government figures showed industrial production expanded 1.0 percent, after two consecutive monthly falls, thanks to brisk production of electronics devices and chemical products.

The reading beat market forecasts for a 0.5 percent decline and marks a sharp bounce from the previous month, while the economy ministry also lifted its assessment on factory output.

The surprisingly positive data dampened predictions the Bank of Japan would announce an expansion of its huge easing programme after a meeting Friday.

Japan publishes inflation and unemployment figures Friday morning, which could also be key to the BoJ's decision on whether to unleash more stimulus in the face of slowing global growth.

"Today's data have reduced the chances that the Bank of Japan will announce more stimulus tomorrow," research house Capital Economics said in a commentary.

“However, any signs in tomorrow's inflation and unemployment data that the earlier slowdown in activity has reduced price pressures may still convince policymakers to step up the pace of easing."