— Japan Apr Machine Orders +5.7% M/M; MNI Median Fcast +1.6%
— Japan Govt Repeats View: Machine Orders Rising Gradually
— Japan Apr Core Machine Orders Post 1st M/M Rise in 2 Months
— Japan Apr Core Machinery Orders +6.6% Y/Y Vs Mar -1.1%
— Japan Apr Machine Orders From Overseas +0.3% M/M; Mar -14.4%

TOKYO (MNI) – Japan’s core private-sector machinery orders, a
leading indicator of business investment, rose at a faster-than-expected
pace in April amid lingering uncertainties over global growth, data from
the Cabinet Office showed on Wednesday.

Core orders — which exclude volatile demand from electric
utilities and for ships — rebounded 5.7% on the month in April, marking
the first rise in two months after a 2.8% drop in March and a 2.8% rise
in February.

The April figure came in much higher than the median forecast in an
MNI survey of economists for a 1.6% rise.

April core orders stood at Y788.6 billion, the highest level since
Y819.5 billion in October 2008.

The Cabinet Office maintained its assessment, saying that
“machinery orders are rising gradually.”

Looking ahead, core orders are projected to rise by a solid 2.5% in
the current quarter ending in June, backed by demand for rebuilding the
areas hit by the 2011 earthquake disaster, the Cabinet Office has
projected.

Even if core orders fell 2% m/m in both May and June, they would
still grow 2.5% in the April-June quarter.

But economists have warned of downside risks to the Japanese
economy amid uncertainties about global demand, the drag from the strong
yen and the sustainability of robust domestic vehicle output.

The Economy Watchers Survey’s forward-looking index, which gauges
conditions two to three months ahead, slipped to 48.1 in May from 50.9
in April, posting the first fall in two months, forcing the government
to downgrade its economic assessment, saying that “the pace of the
recovery has moderated.”

Japanese carmakers have raised their production capacity after the
government resumed subsidies for buying low-emission vehicles in
December, but the program is widely expected to run out of money in
July, two months earlier than planned.

From a year earlier, core private machinery orders rose 6.6% in
April following a 1.1% fall in March.

Offshore orders, which are not part of core orders, increased only
0.3% from the previous month in April, marking the first rise in three
months, after a 14.4% drop in the previous month.

Last week China’s central bank lowered benchmark lending and
deposit rates for the first time since the global financial crisis in
the most aggressive move yet to shore up growth in the face of rapidly
slowing economic activity.

tokyo@marketnews.com
** MNI Tokyo Newsroom: 81-3-5403-4835 **

[TOPICS: M$J$$$,M$A$$$,MAJDS$,MT$$$$]