Japan’s weak machinery orders weigh on outlook
Machinery orders in Japan contracted to their lowest level in about a year in February. According to data, the decline undermined optimism for an increase in capital expenditure as this is necessary for the sector’s acceleration from the coronavirus drag.
Data from the Cabinet Office showed that core orders dropped 8.5% in February from a month ago. The figure came to be the weakest pace since April 2020 as it marked the second consecutive month of contraction. The reading also placed lower than the 2.8% growth predicted by analysts, plunging lower than the 4.5% drop recorded in January.
While companies’ investment in plant, equipment, and wage hikes might alleviate the world’s third-largest economy from deflation, firms were hesitant as the fourth wave of coronavirus infections remained a threat.