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Japan July machinery orders up 0.9% on high demand from manufacturers

This July 30, 2021 file photo shows an assembly line at a Toyota Motor Corp. plant in Miyawaka, Fukuoka Prefecture. (Mainichi)

TOKYO (Kyodo) -- Japan's core private-sector machinery orders rose 0.9 percent in July from the previous month, marking the first increase in two months, backed by strong demand in the manufacturing sector, government data showed Wednesday.

    The orders, excluding those for ships and from utilities because of their volatility, totaled 859.7 billion yen ($7.8 billion), according to the Cabinet Office. Machinery orders are seen as a leading indicator of corporate capital spending.

    The figure followed a 1.5 percent decline in June, after three consecutive monthly rises since March.

    Machinery orders from the manufacturing sector grew 6.7 percent to 431.1 billion yen, expanding for the fourth month in a row.

    A government official told reporters that orders for semiconductor-producing equipment from electrical machinery makers remained brisk amid a global chip crunch, while demand from the shipbuilding and automobile sectors has been growing recently.

    Orders from the nonmanufacturing sector fell 9.5 percent to 425.9 billion yen, registering the first shrinkage in three months. Those from the construction as well as wholesale and retailing sectors were especially sluggish, according to the official.

    The Cabinet Office retained its assessment that machinery orders are showing "signs of picking up," unchanged for the second straight month after an upward revision in May.

    "The three-month moving average of the orders continued to be on the upswing, but the gain was relatively small on a single-month basis, so we'd like to wait and see a little more," the official said.

    Total orders stood at 2.9 trillion yen, up 11.7 percent from the previous month. Among them, orders from overseas, seen as an indicator of future exports, jumped 24.1 percent to 1.5 trillion yen, following a 10.0 percent decline in the previous month.

    Those from the public sector soared 14.0 percent to 293.7 billion yen after they decreased 2.8 percent in June.

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