Japanese economic data mixed

Japan's economy has so far held up but the outlook remains weak.

Today, Bloomberg reports that Japan's current account surplus shrank in May.

Japan's current-account surplus narrowed for a third month in May as record oil prices pushed up the import bill and export growth slowed.

The surplus shrank 5.9 percent to 2 trillion yen ($18.7 billion) from a year earlier, the Ministry of Finance said in Tokyo today. The median estimate of 30 economists surveyed by Bloomberg News was for the gap to decrease to 1.92 trillion yen...

Imports climbed 4 percent to 5.98 trillion yen in May, compared with 13.4 percent in April, today's report showed. Japan imports virtually all of its oil. Crude oil surged to a record $145.85 a barrel on July 3...

Exports rose 4.2 percent in May from a year earlier, compared with 4.9 percent in April, today's report showed. Shipments to the U.S., Japan's largest export market, fell for a ninth month in May, a separate ministry report showed last month. Today's trade figures don't include regional breakdowns.

The rise in the prices of imported commodities helped push Japan's wholesale inflation rate to a 27-year high of 5.6 percent in June.

Economic reports earlier in the week had given mixed signals.

Machinery orders rose faster than expected in May.

Equipment orders, which signal capital spending in the next three to six months, rose 10.4 percent from April when they climbed 5.5 percent, the Cabinet Office said today in Tokyo. The median estimate of 36 economists surveyed by Bloomberg News was for a 1.1 percent gain.

But sentiment among Japanese merchants fell to a six-year low in June.

The Economy Watchers index, a survey of barbers, taxi drivers and others who deal with consumers, dropped to 29.5 from 32.1 in May, the Cabinet Office said today in Tokyo. An index of conditions in two to three months slid to 32.1, the worst since September 2001, from 35.1.

So Japan's economy could still be headed for a decline.

But if so, it's unlikely to be the only economy in Asia to do so. Singapore may actually be leading the way down after its GDP reportedly shrank an annualized 6.6 percent in the second quarter.