Core private-sector machinery orders fell 3.7 percent in May from the previous month, due partly to weak demand in sectors such as nonferrous metal products, government data showed Wednesday.
The orders, which exclude those for ships and from utilities because of their volatility, totaled ¥907.9 billion ($8.2 billion).
The decline in machinery orders, seen as a leading indicator of capital expenditure, followed a 10.1 percent rise in April. The Cabinet Office maintained in its basic assessment that machinery orders are “picking up.”
Despite the decline in the reporting month, “the overall trend (of recovery in machinery orders) has not changed,” an official with the Cabinet Office said, adding that growth remains solid in the manufacturing sector.
Some large orders for metalworking equipment the previous month rolled away, pushing down overall core machinery orders. The agriculture and fishery, and financial sectors also shed orders.
Domestic firms have recently been increasing business investment as they expand capacity to meet robust overseas demand, and have stepped up automation to cope with a labor crunch.
For the manufacturing sector in June, orders rose 1.3 percent to ¥453.8 billion for the second consecutive month of growth. Those from the nonmanufacturing sector, minus ships and utilities, were up 0.2 percent to ¥478.7 billion, gaining for the fifth month in a row.
Overseas demand for domestic machinery, an indicator of future exports, gained 1.8 percent to ¥1.05 trillion.
Total orders, also including those from the domestic public sector and abroad, gained 3.2 percent to ¥2.59 trillion.
In a time of both misinformation and too much information, quality journalism is more crucial than ever.
By subscribing, you can help us get the story right.