October 8, 2015 10:04 am JST

Japan's August core machinery orders down 5.7% on month

TOKYO (Kyodo) -- Japan's core private sector machinery orders fell a seasonally adjusted 5.7 percent in August from the previous month to 759.4 billion yen ($6.33 billion), the government said Thursday, downgrading its basic assessment of the orders for the second month in a row.

     The orders, which exclude those for ships and from utilities because of their volatility, are widely seen as an indicator of future capital expenditures.

     The government cut its basic assessment, saying core machinery orders are "at a standstill." The previous assessment was that orders are "at a standstill in their pickup trend."

     The data could bode ill for the government of Prime Minister Shinzo Abe, who sees business investment as a pillar of the country's economic growth.

     Orders from the manufacturing sector dropped 3.2 percent to 347.9 billion yen in August, down for the third straight month, while those from the nonmanufacturing sector slid 6.1 percent to 422.1 billion yen for the second straight monthly fall.

     In the manufacturing sector, the steel and nonferrous metal industries saw significant declines, while orders from the petroleum and coal products industries jumped.

     Total orders, including those from the domestic public sector and abroad, fell 14.6 percent to 2,110.3 billion yen.

     Overseas demand for Japanese machinery, an indicator of future exports, plunged 26.1 percent to 872.3 billion yen.