Japan August machinery orders drop first in three months, sluggish growth continue to dominate

Core machinery orders in Japan dropped for the first time in three months during the period of August amid an environment of sluggish economic growth both internal as well as external.

Japan’s core machinery orders, a leading indicator of business investment, fell 2.2 percent from the previous month, government data released showed Wednesday. The result compares with a decline of 5.5 percent forecast by economists surveyed by The Wall Street Journal and the Nikkei. On an year-over-year basis, core orders gained 11.6 percent.

However, business investment is expected to grow 4.6 percent in the year ending March 2017, according to the Bank of Japan's tankan survey released earlier this month. Further, retail sales fell 1.1 percent on month, while industrial production grew 1.5 percent. Exports came remained flat on month.

Meanwhile, the Cabinet Office left its assessment of the indicator unchanged, saying machinery orders were showing signs of picking up, reports said.