Japan: Machinery orders in October expand at fastest pace in 19 months
December 9, 2015
Core machinery orders (a leading indicator of capital spending over a three- to six-month period) expanded in October for the second consecutive month, hitting a 19-month high and suggesting that capital expenditure is strengthening at the end of the year. Headline machinery orders (private sector, excluding volatile orders) expanded 10.7% in October over the previous month, in seasonally-adjusted terms, which followed the 7.5% increase recorded in September. The result contrasted the 1.5% decrease that market analysts had expected.
While overall manufacturing orders rebounded strongly in October, growth in non-manufacturing books eased slightly in the same month. In addition, export orders soared and hit a 16-month high in October.
Compared to the same month last year, core machinery orders expanded 10.3% in October. The print contrasted the 1.7% drop tallied in the previous month. As a result of October’s improvement, the trend now points upward, with annual average growth in core machinery orders rising from September’s 3.0% to 4.1%.