TOKYO (Dow Jones)--Japan's industrial output likely bounced slightly in December after a three-month drop, but a blip higher wouldn't signal a turnaround in the beleaguered manufacturing sector. Production is expected to have increased 1.1% on-month in December, according to a survey of economists by Dow Jones Newswires and Nikkei News. The meager rise in December would mean output fell 2.6% in the October-December period, according to Nomura Research Institute. That would mark the fourth straight quarter of decline and the longest string of falls since the four-quarter slide through March 1994, highlighting the damage inflicted on manufacturers by the plunge in exports and weaker domestic demand. The Ministry of Economy, Trade and Industry is scheduled to publish the figures at 8:50 a.m. Tuesday (2350 GMT Monday). Any rise in output in December would be due to a rebound from dismal numbers in the previous three months. Production fell in 1.7% in November, 0.2% in October and 2.9% in September. Even a larger-than-expected rise wouldn't be a sign that either production or Japan's recession-ravaged manufacturing sector is poised to turn the corner, analysts said. Last month, METI forecast output would rise 2.1% in December, based on company surveys. A weaker performance would show that firms still continue to overestimate the strength of demand. Japan is now entrenched in what some analysts say could be its worst recession in the postwar period. Business investment has evaporated as corporate profits plunge, and a record unemployment rate of 5.5% has sucked the life out of consumer sentiment. Japan's economy was already on the skids last year when global demand for information technology products slowed, dragging the U.S. economy down with it. Then the world economic pictured darkened considerably after the Sept. 11 terrorist attacks on the U.S. Japan's latest merchandise trade surplus data out Thursday underscored the extent to which the global economic slowdown has hurt manufacturers here by sapping demand in their key overseas markets. Exports fell for nine months through December in value terms, down 14.4% in that month from a year earlier. Export volumes plummeted 15.3% on-year in December - a record drop that showed the pressure on manufacturers hasn't abated. But the recent rise in U.S. share prices suggests that financial markets expect the U.S economy to bottom out in the first quarter this year and perhaps start recovering as early as the April to June period. Stronger demand in the U.S. - Japan's largest export market - would give local manufacturers a boost. Economists expect any Japanese economic recovery to lag behind that of the U.S. "We are thinking that (Japan's) economy will hit a bottom in the end of spring or beginning of summer, but it won't be a steady bottom from which we can see a strong recovery," said Yasushi Okada, economist at Credit Suisse First Boston Securities in Tokyo. Matthew Poggi, economist at Lehman Brothers in Tokyo, expects the coming half-year to be bumpy, and says industrial output is likely to continue contracting in the near term. Poggi expects output to fall by between 2.5% to 2.8% in the October to December period. "Quarters one and two will also be negative, in quarter-on-quarter terms, but we might start to see a change in the third quarter," Poggi said.