Japan Machinery Orders

Japan's core machinery orders, which exclude those for ships and electric power companies, fell 3.2% month-on-month to 857.8 billion yen in May 2024, accelerating from a 2.9% drop in April and falling at the fastest pace since November last year. The latest reading also missed market expectations for a 0.8% gain. The decrease in capital spending was driven by a sharp decline in the non-manufacturing sector which dropped 7.5% to 439.7 billion yen in May, while the manufacturing sector saw an increase of 1% to 423.7 billion yen. The highly volatile data series is considered as a leading indicator of capital spending in the coming six to nine months. On an annual basis, private-sector machinery orders increased 10.8% in May.