Japan machinery orders advance, coronavirus takes toll on outlook

Japan had seen its core machinery orders advance for two consecutive months ended November, data showed on Thursday. However, an increased number of coronavirus cases monitored in Tokyo and 10 other areas might affect business appetite for capital spending.

Core orders recorded a 1.5% increase in November month-on-month, completely reversing from a 6.2% drop expected by analysts. The jump could be attributed to an upbeat demand for chip-making equipment and computers as people working from home grew in number.

More so, the increase in core orders, a key indicator of capital expenditure, could temporarily ease policymakers from pressure. This is expected as corporate investment might lead to a private demand-driven rebound in the world’s third-largest economy.