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Japan Investment November 2022

Japan: Core machinery orders drops at sharpest pace since February in November

Core machinery orders—which cover the private sector, exclude volatile orders and are a leading indicator for capital spending over the coming three-to-six-month period—nosedived 8.3% month-on-month in seasonally-adjusted terms in November (October: +5.4% mom). November’s result marked the worst reading since February.

On an annual basis, machinery orders fell 3.7% in November (October: +0.4% yoy), the worst result since February 2021. Meanwhile, annual average machinery orders growth fell to 6.4% in November (October: +7.6%), signaling a worsening trend in the sector.

Novembers print means core machinery orders in October–November were down 4.1% from the Q3 average, boding poorly for fixed investment figures in the upcoming Q4 GDP print, which is due to be released on 14 February.

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