Japan Machinery Orders Surge

But economic jitters linger

A key gauge of corporate capital spending Japanese machinery orders, rose at the fastest pace in almost four years in July, but the report failed to erase concerns about the health of the economy. Japan's core private-sector orders jumped by 17% in July from the previous month, the government said Sept. 11.

It was the biggest month-on-month gain since a 17.2% rise in October 2003, according to the industry ministry.

Machinery orders placed by the manufacturing sector grew 10.8 % in July, led by orders for the semiconductor and other electrical machinery industries.

Orders by non-manufacturers shot up 19.4%, buoyed by large orders from the transport and telecommunications industries.

But foreign orders fell 10.8% in July, adding to jitters about the effect on Japan's exports of the U.S. economic slowdown. "The relatively large decline in foreign orders is a bit worrying because this could suggest that foreign orders are falling led by weak U.S. demand," Daiwa Institute of Research senior economist Junichi Makino said.

Copyright Agence France-Presse, 2007

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