Japan's core machinery orders increase 5.5 percent in March

Japan's core machinery orders increased 5.5 percent in March from a month earlier on a seasonally adjusted basis, the Cabinet Office said Thursday.

According to the office, machinery orders in the recording period totaled 895.1 billion yen (8.12 billion U.S. dollars), with the orders excluding volatile ones including ships and from utilities.

The figure came in above median analysts' expectations.

With machinery orders being a key advance indicator for corporate capital spending, with the government using the data to predict the strength of business spending in a six to nine month period ahead with such business investment accounting for roughly 15 percent of Japan's gross domestic product, analysts are now eyeing the government and the central bank's reaction to the latest machinery order data and a slew of other macroeconomic figures, to determine if any further monetary easing measures will be taken.

The types of machinery included in the monthly government survey comprise engines and turbines, heavy electrical machinery, electronic and communication equipment, industrial machinery, machine tools, railway rolling stock, road vehicles, aircraft, ships, water crafts, as well as sub types in the aforementioned categories.

The Cabinet Office's figures Thursday, which come on the heels of orders slumping 9.2 percent a month earlier, follow Japan's March quarter GDP being shown on Wednesday to have risen at a better-than-expected 1.7 percent annualized pace in the first three months of this year. Endit