Japan: Machinery orders decline again in September
November 10, 2016
Core machinery orders (a leading indicator of capital spending over a three- to six-month period) declined for the second consecutive month in September, suggesting slowing momentum in capital expenditure. Headline machinery orders (private sector, excluding volatile orders) fell 3.3% in September from the previous month in seasonally-adjusted terms, which followed the 2.2% decrease recorded in August. The result surprised market analysts who had expected a softer 1.5% drop.
The decline in overall manufacturing orders quickened in September, while non-manufacturing books recorded a milder contraction. Export orders expanded for the second consecutive month in September, albeit at a weaker rate.
Compared to the same month of the previous year, core machinery orders expanded 4.3% in September, which followed the 11.6% increase observed in August. As a result of September’s annual expansion, the trend continues pointing upward. The annual average variation in core machinery orders rose from August’s 0.7% to 1.4%.