Core private-sector machinery orders rose a seasonally adjusted 1.5 percent in February from the previous month, boosted by robust demand for equipment in the manufacturing sector, government data showed Wednesday.
The orders came to ¥850.5 billion ($7.8 billion). These figures exclude orders from ships and utilities because of volatility in the sectors, widely viewed as an indicator of future capital spending by companies. The latest data followed a 3.2 percent fall in January.
The Cabinet Office maintained its basic assessment that the recovery in machinery orders has slowed.
“Although machinery orders have been going up and down (in recent months), the (recovery) trend has not changed on balance,” an official with the Cabinet Office said.
A gain of about 10 percent will be needed in March for machinery orders to achieve a projected 1.5 percent increase in the January-March quarter, which the official said could be “difficult.”
Orders from the manufacturing sector rose 6.0 percent to ¥350.8 billion, as strong growth in the pulp and paper sector as well as in food and beverages helped the total figure recover from a sharp fall.
Orders from the nonmanufacturing sector advanced 1.8 percent to ¥516.6 billion, helped by higher demand for nuclear power equipment.
Recovering exports have given a boost to the Japanese economy in recent months, although the outlook for capital spending remains unclear, according to analysts.
Uncertainty persists over the future of U.S. economic and trade policies along with geopolitical risks following the recent military strike on Syria by the United States.
Overseas demand for Japanese machinery, an indicator of future exports, dropped 1.1 percent to 870.9 billion.
Total orders, including those from the domestic public sector and abroad, fell 1.3 percent to ¥2.21 trillion, marking the third straight monthly decline.
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