Learning Investment09 - Japanese machinery orders reportedly rose two consecutive months to
January on Monday (14/03) this. The data also shows that companies expect
demand will increase in line with the policy of the Japanese government which
will further add to the stimulus.
Japan's core machinery orders, which do not include vessels and power
tools, jumped to 15.0 percent month-on-month in January, according to the
Cabinet Office. The number is far higher than the 2.0 percent rise forecast by
analysts calculated and outperformed an increase of 4.2 percent in December.
Factories are key drivers that drive a sharp rise in the purchase of
machinery sector, which achieved growth of up to 41.2 percent in January.
Meanwhile, the non-manufacturing orders increased by only 3.6 percent.
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Japan Investment Rises
According to economist Marcel Thielant at Capital Economics Japan in a
note that summarized by WBP Online today: "We did not expect too much on
the data for the calculation of one month only, however, the data today showed
that the investment budget will rise rapidly this time in the quarter. "
The increase in machinery orders show that companies are expect an
increase in demand, after "nina-bobo" long enough during the December
quarter, especially when the economy contracted 0.3 percent due to a sharp
decline in private consumption.
Related to the Japanese monetary policy, Thielant added that given the
disappointing market reaction to the negative interest rates recently
introduced by the BoJ last January, with this data BoJ will still be able to
work with confidence, or at least to restore confidence in the near future.
Responding to the report, the USD / JPY is still at the high level that
had reached 113.80 on March 3. On 10 March, the USD / JPY drop towards 112.84
after the ECB's policy positions are cut interest rates again and crush the US
Dollar.