Core private-sector machinery orders in Japan increased 1.5 percent in February on a seasonally-adjusted basis from the previous month, the government said in a report on Wednesday.
According to the Cabinet Office, core private-sector machinery orders totaled 850.5 billion yen (7.8 billion U.S. dollars), in the recording period, showing a slight uptick in capital expenditure.
The 1.5 percent rise in February, however, was less than median market expectations for a 2.7 percent increase and comes on the heels of a 3.2 percent slump logged in January, the government's data showed.
Machinery orders are a key advance indicator for corporate capital spending in Japan and the government uses the data to predict the strength of business spending in a six- to nine-month period ahead. Such business investment accounts for around 15 percent of Japan's gross domestic product.
The gradual pickup in orders shown in February will be a slight boon for the government that has been counting on capital expenditure to kick-start growth, against a backdrop of economic malaise and lack of significant growth drivers.
Recent surveys this month including the Sakura Report and the Economy Watchers Survey have showed that some sectors and companies still feel disinclined to invest money, however, as they perceive current and future business conditions as not improving. Such conditions include labor shortages and rising purchase prices.
The Bank of Japan, for its part, has been struggling to combat deflation and is some way off reaching its 2 percent inflation goal, the deadline of which has been delayed multiple times.
On an annual basis, the Cabinet Office said that core orders increased 5.6 percent in February following an 8.2 percent tumble on year a month earlier.
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