Japan Sept. machinery orders seen rising for first time in three months: Reuters poll

TOKYO (Reuters) - Japan’s core machinery orders likely rose for the first time in three months in September, a Reuters poll showed on Friday, but a strong recovery is considered unlikely in the near term given sluggish global growth.

FILE PHOTO: Businessmen walk past heavy machinery at a construction site in Tokyo's business district, Japan, January 16, 2017. REUTERS/Toru Hanai

Core machinery orders, a highly volatile data series regarded as an indicator of capital spending in the coming six to nine month, likely grew 0.9% in September from the previous month, the poll of 17 economists found.

They fell 2.4% in August and 6.6% in July.

From a year earlier, core orders, which exclude those for ships and electric utilities, were seen rising 7.9% in September following a 14.5% drop in August.

“Manufacturers’ orders likely started picking up while non-manufacturers may be dragging,” said Koya Miyamae, senior economist at SMBC Nikko Securities.

“A rebound in core machinery orders is likely to be only moderate.”

But economists also said solid demand for labour-saving and automated equipment to cope with the country’s labour shortage would underpin orders.

The Cabinet Office will release the machinery orders data at 8:50 a.m. on Nov. 11 Monday Tokyo time (2350 GMT Nov. 10).

Next week’s data also includes the current account balance, which is expected to show a surplus of 1.68 trillion yen ($15.38 billion) in September, thanks to gains in income from investments overseas.

The finance ministry will publish the current account balance on Monday.

The Bank of Japan’s corporate goods price index (CGPI), which measures the prices companies charge each other for goods and services, likely slipped 0.3% in October from a year earlier, down for fifth straight month, on lower oil prices, the poll found.

The central bank will release the data on Wednesday.

On Thursday, data is expected to show Japan’s economic growth slowed to an annualised 0.8% in July-September from 1.3% in the second quarter, another Reuters poll showed.

Prime Minister Shinzo Abe on Friday ordered his cabinet to compile a package of stimulus measures to support the economy and build infrastructure to cope with large natural disasters, with additional spending in an extra budget at the end of the year.

The size of the package has yet to be determined.

Reporting by Kaori Kaneko; Editing by Kim Coghill