Japan’s Machinery Orders Rise for First Month in Four
By Keiko Ujikane - Feb 9, 2011
Japanese machinery orders rose for the first time in four months in December, a sign that companies will increase spending to meet demand from abroad.
Factory orders increased 1.7 percent from November, when they dropped 3 percent, the Cabinet Office said today in Tokyo. Orders, an indicator of capital spending in three to six months, were projected to climb 5 percent, according to the median forecast of 28 economists surveyed by Bloomberg News.
Demand from China and the U.S., Japan’s biggest export markets, is improving corporate earnings and prompting companies including Mitsubishi Electric Corp. and Hino Motors Ltd. to invest in plants and equipment. Companies surveyed by the government forecast orders will increase 2.7 percent this quarter after contracting at the end of 2010, the report showed.
“Japan’s capital investment is in an expansionary trend,” said Yoshimasa Maruyama, a senior economist at Itochu Corp. in Tokyo. “The economy is emerging from a slump, but it’s difficult to anticipate companies speeding up the pace of investment.”
Maruyama said growing profits may encourage companies to invest more overseas given that demand abroad for Japanese products is growing.
The yen traded at 82.42 per dollar at 9:40 a.m. in Tokyo, compared with 82.44 before the report was published. The Nikkei 225 Stock Average fell 0.4 percent.
Read more
bloomberg.com |
