The Bank of Japan lowered its forecast for the country’s economic growth, indicating to the steel shortages as a reason for the downgrade. Japan’s two leading steel producers, Nippon Steel and JFE, are desperately pumping up output to boost demand but still falling short of the production needs.

“Japan’s economy continues a recovery trend, although there seem to be somewhat weak movements mainly in production,” the BoJ said in a monthly report.

The central bank insists that the Japanese economy “continues to recover” although most analysts point to the evident stagnation. Industrial production in the country dropped 0.7% in the third quarter and was down 1.3% on a month-on-month basis in October.