Japan’s core private-sector machinery orders rose a seasonally adjusted 6.3 percent from the previous month to 1.035 trillion yen in April, after a 3.6 percent fall in March, the Cabinet Office said Thursday.
It was the highest month-on-month gain since October, when key orders grew 7.7 percent from the previous month, it said.
“The trend in machinery orders is weak, and we will be carefully watching future movements,” said Yoshihiko Senoo, a senior official at the Cabinet Office’s Economic and Social Research Institute, explaining why the government’s assessment on the machinery orders data remains unchanged from the previous month. “A single month of favorable data is not enough to advance upward our assessment.”
Compared with the year before, core orders gained 10.5 percent for the 17th straight year-on-year increase, the office said.
Private-sector machinery orders are considered a leading indicator of corporate capital spending six to nine months ahead. Core orders exclude those for ships and from power companies to discount volatility stemming from their large size.
A quarter-to-quarter rise of 0.4 percent is forecast for the April-June period. This will be realized even if the key orders mark a 4.2 percent month-on-month fall in May and June, the office said.
Senoo said it is quite likely that the 0.4 percent rise in the June quarter will be achieved.
Orders from manufacturers, which fell 0.4 percent from the previous month to 399.4 billion yen, decreased for the fourth straight month, dragged under by a tumble in orders from electric machinery makers, shipbuilders and nonferrous metal manufacturers.
Orders from the nonmanufacturing sector, meanwhile, rose 8.8 percent from the previous month to 627.7 billion yen, following a 3.6 percent fall in March, it said.
Overall orders, including government and foreign orders, rose 4.4 percent from the previous month to 2.228 trillion yen, following a 3.8 percent decline in March.
Government orders expanded 16.2 percent to 346.2 billion yen, while foreign orders dropped 24.8 percent to 523.4 billion yen.
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