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June core machinery orders down 8.8%

Jiji Press TOKYO (Jiji Press) — Seasonally adjusted core machinery orders in June fell 8.8 percent from the previous month, the second straight decline, the Cabinet Office said Thursday.

Private-sector orders excluding those for ships and power equipment, closely watched as a leading indicator of corporate capital spending, came to ¥827.6 billion.

The June result, which followed a 3.7 percent decrease in May, compared with the median estimate of a 0.9 percent decline by 18 economic research institutes surveyed by Jiji Press. Their estimates ranged from a fall of 6.5 percent to a rise of 5.3 percent.

The Cabinet Office said a recovery in machinery orders has paused, lowering its assessment for the first time in one year and one month. It previously said machinery orders were recovering.

Machinery orders from manufacturers dropped 15.9 percent to ¥381.8 billion, as orders from electric machinery makers fell back following a sharp increase in the previous month. Orders from chemical producers also decreased substantially.

Core orders from nonmanufacturers went down 7.0 percent to ¥445.4 billion, reflecting sluggish orders from construction companies.

In April-June, orders expanded 2.2 percent from the previous quarter to ¥2,678.6 billion.

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