Future Japan's machinery exports are not optimistic

The figures released by the Cabinet Office of Japan on the 10th showed that due to the increase in one-off large orders in the chemical industry, Japan’s core machinery orders increased by 3.5% in July to 771.7 billion yen (about US$7.26 billion) after a seasonal adjustment. , indicating that the business investment situation has shown signs of improvement. The core machinery order index is a key indicator of Japanese companies’ investment status, while corporate investment is considered by the Shinzo Abe cabinet as one of the important engines to fight deflation in the past 20 years and boost Japan’s economic growth. Cabinet Office figures show that machinery orders in the manufacturing sector in Japan increased significantly by 20.3% MoM to 363.9 billion yen (US$3.22 billion) in July, while machinery orders from non-manufacturing sectors decreased by 4.3% QoQ to 425 billion yen. (About 3.99 billion US dollars).

In July, machinery orders from overseas dropped by 42.6% qoq to 816.9 billion yen (about 7.69 billion U.S. dollars), indicating that Japan's machinery exports will not be optimistic for some time in the future.

Since raising the consumption tax by three percentage points on April 1, Japan’s core machinery order index has experienced major fluctuations due to the slowdown in domestic demand. From April to May, the index fell by 9.1% and 19.5% respectively from the previous quarter, and rose by 8.8% from the previous month. In July, the Cabinet Office maintained a basic assessment of the core machinery order index, saying that it was “up and down”.