The production sub-index edged up to 52.2 from 52.1, pointing to improving industrial production growth after a moderation in June, driven by sustained momentum in electronics-related segments. Nomura said the inventory drawdown indicated firms were running down stockpiles in the face of still-robust demand, implying strong electronics production would continue beyond the near term. Nomura said it continued to flag upside risks to its 2026 GDP growth forecast of 4.6%, which already sits above the consensus estimate of 4%. Beyond a broadening of AI-related demand and the chip supercycle boosting industrial production, the house said growth would continue to be powered by multiple engines. Nomura expects the government to raise its 2026 growth forecast to a range of 3% to 5%, up from 2% to 4%, at the final second-quarter GDP release on 11 August.