Machinery orders fell more than economists expected in March as a global slowdown and waning profits dissuaded companies from investing in factories and equipment.
Equipment orders, which signal capital spending in the next three to six months, declined 8.3 percent from February, when they fell 12.3 percent, the Cabinet Office said Thursday. The median estimate of 33 economists was for a 5.1 percent drop.
Companies surveyed in the report forecast that orders in the second quarter will fall 10.3 percent. Toyota Motor Corp. said last week it will cut spending on plant and equipment as falling U.S. sales, higher commodity prices and a stronger yen erode earnings.
The Cabinet Office downgraded its assessment for orders, saying they are "showing some weakness," a change from previous language that described them as "seesawing."