Machinery Orders Rise More Than Expected in Japan

“Japan’s machinery orders rose more than forecast in July even as weakness in exports and waning subsidies for auto purchases threaten to stifle economic growth.

Orders, an indicator of capital spending, climbed 4.6 percent from the previous month, after gaining 5.6 percent in June, the Cabinet Office said today in Tokyo. The median estimate of 29 economists surveyed by Bloomberg News was for a 2 percent increase. Large orders can cause volatile results.

Today’s data and a pick-up in manufacturers’ confidence signal some resilience in an economy that Bank of America Merrill Lynch says is at risk of contracting this quarter. Japanese exports may benefit from U.S. and Chinese efforts to spur demand, with the Federal Reserve meeting this week and Premier Wen Jiabao saying yesterday that his nation has ample fiscal and monetary room to support growth.”

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