Weak data bring pressure for more stimulus in China, Japan

BEIJING • China and Japan reported gloomy industrial data Wednesday, adding to pressure on leaders of the world’s second- and third-largest economies to launch new stimulus.

Two surveys showed Chinese manufacturing was weak in February and employers cut more jobs. In Japan, a central bank survey found companies expect conditions to deteriorate and plan to cut investment.

The latest data muddy the global outlook at a time when the U.S. is the only major economy to show signs of momen- tum. Both China and Japan are relying on U.S. demand and a strong dollar to offset internal problems. Either could send shock waves through the global economy if efforts to overhaul their economic models fail.

The loss of manufacturing jobs is a setback for Chinese leaders who are trying to steer their economy to more sustainable growth based on domestic consumption while avoiding a politically dangerous spike in unemployment. They have cut interest rates twice since November but want to avoid a large-scale stimulus that would set back efforts to reduce reliance on investment.

The surveys by HSBC Corp. and an industry group, the China Federation of Logistics and Purchasing, found manufacturing was weak in February. HSBC said companies shed jobs at their fastest rate in seven months. That came after China’s central bank governor, Zhou Xiaochuan, warned Sunday economic growth had fallen “too sharply.”

The Bank of Japan’s quarterly “tankan” survey, the country’s leading measure of corporate sentiment, highlights a dilemma for leaders who are trying to break out of two decades of stagnation.

Japanese media assert there is growing friction between the central bank and Prime Minister Shinzo Abe’s administration over expanding stimulus further. The central bank governor, Haruhiko Kuroda, says the economy is on course for a moderate recovery and inflation will pick up again after it cools due to lower oil prices.