Thursday, 9 July 2009

Japanese machinery orders hit record low

Despite some positive signs of late, Japan's economic recovery remains in doubt, especially after the numbers reported on Wednesday. From the WSJ:

Japanese core machinery orders fell to a record low in May, dropping 3% from April, fueling concerns that companies may be putting business-investment plans on hold...

Core orders, which exclude often-volatile orders for ships and electric-power companies, stood at 668.2 billion yen ($7.05 billion), their lowest value in monetary terms since the government began compiling the data in a comparable form in 1987.

Trade data were not encouraging either.

The nation's current-account surplus, meanwhile, shrank 34.3% in May from a year earlier, with a faster decline in exports underscoring the impact of the global slump in demand...

In April, the surplus fell 54.5% year-to-year to 630.5 billion yen. Exports decreased 42.2% on year.

But it was not all negative.

Meanwhile, Japanese worker sentiment rose for the sixth straight month in June, the cabinet office's Economy Watchers Survey showed, to 42.2 from 36.7 in May. Analysts said the improvement is largely due to the effect of tax-relief measures in the government's stimulus program, and so further deterioration in sentiment is a possibility.

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