Machinery orders, a leading indicator of capital spending over a three to six month period, deteriorated for the first time so far this year. In March, core machinery orders (private sector, excluding volatile orders) contracted a seasonally adjusted 2.8% over the previous month, which contrasted the 2.8% rise recorded in February (previously reported: +4.8% month-on-month). Nevertheless, the print overshot market expectations that had orders declining 3.5%. The deceleration was the result of an outright contraction in manufacturing orders, particularly in chemical products, while non-manufacturing bookings recorded a softer drop. However, machinery orders from overseas, which determine future exports, continued to decline in March. Compared to the same month last year, core machinery orders fell 1.1% in March, which contrasted both the 8.9% rise observed in February and the 4.4% expansion expected by market analysts. Accordingly, the trend deteriorated in March, with annual average growth falling from 7.6% in February to 6.2% in March. According to the survey, the Cabinet Office predicts a 2.5% expansion in the second quarter, after the 0.9% rise posted in the first three months of this year. Meanwhile, the Cabinet Office maintained its assessment on machinery orders, envisaging
Machinery orders contract for first time in three months
May 16, 2012
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Japan Investment Chart
Note: Month-on-month changes of seasonally adjusted core machinery orders and year-on-year growth rate in %.
Source: Ministry of Economy, Trade and Industry (METI) and FocusEconomics calculations.
Japan Economic News
October 24, 2016
The Nikkei Flash Manufacturing Purchasing Managers’ Index (PMI) rose from September’s revised 50.4 (previously reported: 50.3) to 51.7 in October.
October 24, 2016
In September, nominal exports valued in yen declined 6.9% from the same month last year, which followed August’s 9.6% decline.
October 12, 2016
Core machinery orders (a leading indicator of capital spending over a three- to six-month period) declined for the first time in three months in August.
October 4, 2016
Consumer sentiment rose from August’s 42.0 to 43.0 in September.
October 3, 2016
According to the Bank of Japan’s quarterly TANKAN business survey, sentiment among large manufacturers was stable at 6 in Q3.