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Japan March machinery orders seen up for first time in three months
May 15, 2015 / 5:59 AM / 3 years ago

Japan March machinery orders seen up for first time in three months

TOKYO (Reuters) - Japan’s leading indicator of capital spending is seen to have risen in March for the first time in three months, a Reuters poll found, in a sign business investment may be picking up.

Core machinery orders, a highly volatile data series regarded as an indicator of capital spending in the coming six to nine months, was expected to rise 1.8 percent in March, the Reuters poll of 22 economists showed.

But core orders are forecast to have fallen 7.2 percent in March from a year earlier, which would be the first fall in four months.

“The environment for capital spending is improving due to strong exporters’ earnings helped by a weak yen, a waning impact from the sales tax hike, and rising wages,” said Takeshi Minami, chief economist at Norinchukin Research Institute.

“I think we will see the basic trend of moderate recovery in capital spending ahead, although the data may show some volatility.”

The Cabinet Office will announce the machinery orders data at 8:50 a.m. on May 18 (2350 GMT on May 17). The data will also include companies’ forecasts for the core orders for April-June.

A separate Reuters’ survey showed Japan’s gross domestic product is expected to expand an annualised 1.5 percent in January-March, led by a pick-up in exports and business investment. It would be the second straight quarter to show growth, if realised.

The Bank of Japan last month pushed back the timeframe in which to reach its inflation target, but Governor Haruhiko Kuroda said he saw no need to ease policy further for the time being since rising wages are underpinning a broad uptrend in prices.

Editing by Eric Meijer

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