Japan's core machinery orders drop 2.2 pct on month in August

Japan's core private-sector machinery orders declined 2.2 percent in August on a seasonally adjusted basis from a month earlier, marking the first drop in three months, the government here said Wednesday.

According to the Cabinet Office, core private-sector machinery orders totaled 872.5 billion yen (8.42 billion U.S. dollars), in the recording period, with the drop coming on the heels of a 4.9 percent rise in July and an 8.3 percent increase in June.

According to the office, orders from the manufacturing sector were down 4 percent to 353.1 billion yen and orders from the non-manufacturing sector decreased 1.9 percent totaling 514.9 billion yen.

In terms of the figure for overall orders from all sectors, the Cabinet Office said that orders had retreated 4 percent to stand at 2.06 trillion yen in the recording period.

Overseas demand for Japanese machinery, meanwhile, widely seen as a gauge of future exports, climbed 6.8 percent to 773.8 billion yen, the Cabinet Office also said.

Core machinery orders, including engines and turbines, heavy electrical machinery, electronic and communications equipment, industrial machinery and suchlike, are considered a key yardstick of business investment in the future.

The figures are closely eyed by the government here as they account for around 15 percent of GDP and indicate the state of business investment and how they relate to demand and have intrinsic links to imports and exports, as well as the currency rate. Endit