Japan’s core machinery orders fell 5.7 per cent in August from the previous month for the third straight month of decline, the government said Thursday, the latest sign that the world’s third-largest economy could be in trouble.
The figure was worse than the 3-per-cent rise forecast by analysts polled by the Nikkei business daily and followed a 3.6-per-cent fall in July.
Core private-sector machinery orders, which exclude volatile categories such as ships and utilities, dropped to 759.4 billion yen (6.3 billion dollars), the Cabinet Office said.
Machinery orders were “at a standstill,” it said.
The reading bodes ill for Prime Minister Shinzo Abe’s newly reshuffled cabinet as the statistic is viewed as an indicator of future corporate capital spending.
It also comes at a time when more analysts expected Japan’s economy to suffer another recession amid sluggish spending and slow economic growth in China, the country’s largest trading partner.
Lower oil prices and more profitable overseas investments have eased the burden on the Japanese economy however, as Japan logged a current account surplus for the 14th consecutive month in August.
The surplus stood at 1.65 trillion yen (13.8 billion dollars), compared with a surplus of 249.4 billion yen from the year before, the Finance Ministry said in a preliminary report.
A weaker yen has also helped boost the value of Japanese exports, leading to 62-per-cent fall in the August trade deficit. The deficit stood at 326.1 billion yen, the ministry said.