When an enemy city is captured set its production and direct that production to a HQ. The problem occurs if that HQ is beyond the 100% supply range.
In this case the captured city (Tokyo) was set to produce Political Points. The city is a Capitol, so it should produce 20PP per turn.
The illustration below indicates what happens.
This occurs if producing Recycled resources (and I think supply) as well.
The simple solution is to send the city's production to a closer HQ. By default I was sending production of PPs, supply or recycled resources to my (distant) Supreme HQ and unknowingly receiving inflated production.

