Feb. core machinery orders hit 25-month high

April 11, 2018

Tokyo- Japan's seasonally adjusted core machinery orders rose 2.1 percent from the previous month to mark a 25-month high in February, the Cabinet Office said Wednesday.

The growth reflected robust demand from manufacturers, according to data from the government agency.

Private-sector orders excluding those for ships and power equipment, closely watched as a leading indicator of corporate capital spending, came to 891 billion yen, the highest since 904.9 billion yen in January 2016. The core orders increased for the second straight month.

The February growth came against a median estimate of a 2.5 percent drop among 20 economic research institutes polled by Jiji Press. Their estimates ranged from a fall of 6.2 percent to a rise of 1.9 percent.

The agency kept its assessment unchanged, saying that machinery orders are showing signs of pickup.

Orders from manufacturers jumped 8.0 percent to 442.3 billion yen, up for two months in a row, thanks to brisk demand from steelmakers and a large-scale order from the chemical industry. Meanwhile, orders from electric machinery makers fell.

Orders from non-manufacturers, excluding those for ships and power equipment, came to 465.7 billion yen, up a meager 0.04 percent. Orders from telecommunications and information service providers were solid.

Overall machinery orders, including those from the public sector and abroad, fell 2.3 percent to 2,418.8 billion yen, down for the first time in two months.

While public-sector orders grew 23.6 percent to 256.6 billion yen, overseas orders decreased 7.8 percent to 1,011.3 billion yen. Jiji Press