Japan Machinery Orders Dip

Japan’s core machinery orders unexpectedly fell in January from the previous month and dipped the most in five months, adding to worries about whether recent signs of economic recovery will be sustainable, Reuters reported. Japanese policymakers hope a recovery in capital spending will help drive growth in the world’s third-largest economy and pull it out of deflation and stagnation. Core machinery orders fell 3.2% in January, sharply undershooting the economists’ median estimate of a 0.5% increase, Cabinet Office data showed. That followed a rebound in December, when core orders rose 2.1%. While the data series can fluctuate widely, it is regarded as a leading indicator of capital spending in the coming six to nine months. Compared with a year earlier, core orders, which exclude those of ships and electrical equipment, fell 8.2% in January—the biggest fall in eight months and larger than the analyst estimate for a 3.3% decrease. Manufacturers surveyed by the cabinet office forecast core orders to rise 1.5% in January-March from the previous quarter.