Core private-sector machinery orders fell a seasonally adjusted 6.6 percent in June from the previous month to 946.5 billion yen, marking the second consecutive month of decline, the Cabinet Office said Thursday.

The figure represents an unadjusted 9.5 percent fall from the year-earlier level and the first year-on-year decline in 19 months.

The decline in orders was led by manufacturers, posting a 12 percent fall from the previous month to 348.6 billion yen, while nonmanufacturers registered a 2.7 percent drop to 597.1 billion yen.

“In general, the level of machinery orders is in a declining trend,” said Yoshihiko Senoo, a senior Cabinet Office economist. “We need to closely monitor moves from now on.”

The assessment marks a downward revision in the overall trend, with the office noting a “weakening trend” for the preceding three months.

Private-sector machinery orders are considered a leading indicator of corporate capital spending six to nine months ahead.

The figures exclude orders for ships and from electric power companies, which tend to be volatile because of their large size.

Core machinery orders during the April-June quarter showed a 1.1 percent rise, exceeding the 0.4 percent increase projected earlier, the office said.

But the quarterly trend is deteriorating and the office now forecasts a quarter-to-quarter decline of 5.1 percent for the July-September period, Senoo said.

“As far as the machinery orders data are concerned, corporate investment in equipment and facilities may remain at low levels until the end of the current fiscal year,” he predicted.

In its breakdown of core machinery order data for June, the office said that orders from the electric machinery sector among manufacturers fell by a notable 27.4 percent, reflecting depressed demand from semiconductor-related businesses.

Among nonmanufacturers, orders fell 76 percent from the electric power sector, 51.1 percent from the wholesale and retail sales sector, and 31.4 percent from the transportation sector.

Total private-sector machinery orders, including those for ships and from electric power companies, came to 1.068 trillion yen, down 26.6 percent from the previous month.

Public sector orders came to 382.9 billion yen, up 18.7 percent. Orders from overseas were 454.4 billion yen, down 18.9 percent, and those placed through agencies were 114.4 billion yen, down 2.6 percent.

Japan’s overall machinery orders totaled 2.006 trillion yen in June, down 18.7 percent from May and down 12.5 percent from a year earlier.

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