Economic Outlook - Japan's factory output fell 1.2% in August, exceeding the median market forecast of a 0.8% decline, raising uncertainties about the economic outlook [2][8] - Retail sales in Japan declined 1.1% year-on-year in August, marking the first decline in 42 months, contrary to the expected 1.0% increase [7][8] Industrial Production - The production of electrical machinery and information and communication electronics equipment fell 5.7% in August, while fabricated metal production decreased by 7.8% [3] - Motor vehicle production increased by 2.5% in August, attributed to higher output for models sold overseas and an easing parts shortage [5] Trade and Tariffs - A trade deal between Washington and Tokyo established a baseline 15% tariff on nearly all Japanese imports, down from an initial 27.5% on autos, providing some relief to Japanese exporters [4] - Analysts express caution, noting that higher U.S. import tariffs under the trade deal are negatively impacting shipments from Japanese manufacturers [6] Bank of Japan's Stance - The Bank of Japan is likely to maintain its current interest rates due to the dismal economic data, with Governor Kazuo Ueda indicating a preference for more data before making decisions on rate hikes [6][8]