TOKYO (Reuters) – Japan’s machinery orders were expected to fall in August after the previous month’s spike, a Reuters poll found on Friday, although corporate capital spending was seen likely to be steady despite Sino-U.S. trade tensions.
The poll of 17 economists found that core machinery orders, a volatile data series regarded as an indicator of capital spending in the coming six to nine months, were seen down 4.0 percent in August after they grew 11.0 percent in July.
From a year earlier, core machinery orders, which exclude those for ships and from electric power utilities, were expected to rise 1.6 percent in August after a 13.9 percent gain in July.
“As the Bank of Japan’s tankan survey showed, firms’ willingness to increase capital spending is strong, so capital expenditure is expected to stay solid for a while,” said Takumi Tsunoda, senior economist at Shinkin Central Bank Research Institute.
The latest BOJ tankan survey showed subdued confidence but highlighted solid corporate capex plans, driven by demand for refurbishments and boosting investment in robotics and automation to cope with labour shortages.
Analysts say trade friction between the United States and China has not yet had any visible impact on the Japanese economy.
“As far as trade data shows, negative impacts from the trade war between the U.S. and China have not clearly appeared in Japan’s exports. But manufacturers may wait and see before they raise capital spending,” said Koya Miyamae, senior economist at SMBC Nikko Securities.
The Cabinet Office will release the machinery orders data at 8:50 a.m. Japan time on Oct. 10 (2350 GMT Oct.9).
The poll also found Japan was expected to post a current account surplus of 1.89 trillion yen (12.7 billion pounds) in August after notching 2.0 trillion yen in July.
Higher oil prices likely boosted import costs and surpassed export values, which would result in trade deficit, but a weak yen would increase income from overseas investments, analysts said.
The finance ministry will publish the current account data at 8:50 a.m. Oct. 9 Japan time. (2350 GMT Oct.8 )
The BOJ’s corporate goods price index (CGPI), which measures the prices companies charge each other for goods and services, was seen up 2.9 percent in September led by price gains in electricity- and oil-related items, the poll showed.
(Reporting by Kaori Kaneko; editing by Eric Meijer)