Japan's Core Machinery Orders Up 0.5%

Core orders from manufacturing companies rose 4.9% month-on-month in August.

A leading indicator of corporate capital spending, Japan's core machinery orders, rose by a smaller-than-expected 0.5% in August from the previous month, government data showed on Oct. 9.

The result follows a roller-coaster movement of a 9.3% drop in July and a 9.7% jump in June and was a more moderate rise than the average market forecast for a rise of 2.1%.

Core machinery orders, compared with a year before, tumbled 26.5% in August following a 34.8% drop in July and a 29.7% drop in June.

The core orders, which exclude particularly volatile demand from power companies and for ships, are seen as a key barometer of business investment.

Core orders from manufacturing companies rose 4.9% month-on-month in August while those from non-manufacturers fell 0.6%.

Orders for the July-September quarter are expected to fall 8.6% from the previous quarter following a drop of 4.9% in April-June.

Copyright Agence France-Presse, 2009

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