Data announced by the Cabinet Office. Its for private sector machinery orders excluding volatile ship and power equipment. The data is indicative of capex 6 to 9 months in advance.
+4.9% m/m ..... BEAT
- expected -2.9% m/m, prior +8.3%
+5.2% y/y ..... BEAT
- expected +0.3% y/y, prior -0.9%
The government has raised its assessment for machinery orders saying they are showing pickup.
The consensus median estimates have been beaten for both the m/m and y/y. A positive start to Q3 for this data series despite the appreciating yen and weak global economy
. This is a better piece of news for the Japanese administration and BOJ; at the margin it makes further easing from the central bank less likely at the upcoming September meeting.
Also out was PPI data for August:
- expected -0.1%, prior flat at 0.0%
- expected -3.4% y/y, prior -3.9%
Both the m/m and y/y coming in below consensus median estimates, which is not good news for the BOJ and their inflation target (and let me clarify, the PPI is not CPI inflation, its inflation at the wholesale level, between businesses. It is related, but yes it is different to the CPI). This will offset the positive impact from machinery orders womewhat.
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