Japan's machinery orders down 6.9%

Japan's core machinery orders fell a seasonally adjusted 6.9 percent in October from the previous month to JPY 687.4 billion (USD 8.8 billion) for the second consecutive month of decline, The government said Thursday.It attributed the decline to companies being reluctant to make fresh capital investment due to concerns over the stronger yen and the European debt crisis.The figure dipped below JPY 700 billion (USD 9.0 billion) threshold for the first time since December 2010, according to data released by the Cabinet Office. Core private-sector orders, which exclude volatile demand from electric utilities and for ships, are considered a key indicator of corporate capital spending in the next three to six months. The drop follows a 8.2 percent fall in September.By industry, orders by manufacturers rose 5.5 percent month-on-month in October, while those from non-manufacturers went down 7.3 percent. Overseas demand, an indicator of future Japanese exports, went up 1.6 percent for the first rise in two months.Despite worsening data, the Cabinet Office maintained its basic assessment, saying, "The machinery orders have been one step forward, one step back." A Cabinet Office official said in briefing reporters on the survey that machinery orders were not affected much by the March 11 earthquake. "But there were growing concerns over the Eurozone debt crisis, the slowdown in the US economy and the yen's appreciation," he said.