September 8, 2017 / 4:44 AM / a year ago

PREVIEW-Japan July machinery orders seen rising at fastest pace in a year

* July core machinery orders f’cast +4.4 pct m/m vs June -1.9 pct

* Data due at 2350 GMT Sunday

TOKYO, Sept 8 (Reuters) - Japan’s core machinery orders were expected to rise in July at the fastest pace in a year, a Reuters poll found on Friday, as economists upgrade their capital spending outlook.

A 4.4 percent rise in core machinery orders was forecast for July from June when orders declined by 1.9 percent.

It would be the first rise in four months and the strongest growth since July 2016.

The highly volatile data series is regarded as a leading indicator of capital spending in the coming six to nine months.

Core orders, which exclude those of ships and electric power utilities, were likely to show a fall of 7.3 percent in July following a 5.2 percent decline in June, the poll of 16 economists found.

“Core orders from non-manufacturers have been sluggish recently but they appear to have stopped falling and are expected to pick up in July-September,” said Yuichiro Nagai, economist at Barclays Securities Japan.

“The surrounding environment for capital spending remains favourable with robust demand ahead of the Tokyo Olympic games and companies needing to invest in labour-saving technology as well as research and development.”

The Cabinet Office will issue the machinery orders data at 8:50 a.m. Japan time on Monday (2350 GMT Sunday).

The Bank of Japan will publish its corporate goods price index (CGPI) at 8:50 a.m. Japan Time on Wednesday (2350 GMT on Tuesday). CGPI measures the prices companies charge each other for goods and services.

It is expected to show a 3.0 percent rise in August from a year ago on price gains in oil- and coal-related products after 2.6 percent growth in July.

Japan’s economy grew much less quickly in the second quarter than initially estimated, but analysts still expect the economy to sustain a steady recovery as robust global demand underpins exports and a tightening job market improves the prospects for higher wages. (Reporting by Kaori Kaneko; Editing by Eric Meijer)

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