Robotic arms put in the electric vehicle powertrain into the Ariya model in the assembly line at Nissan's Tochigi plant in Kaminokawa town, Tochigi prefecture, Japan, on Oct. 8, 2021. (AP Photo/Yuri Kageyama)
TOKYO (Kyodo) -- Japan's core private-sector machinery orders fell 2.4 percent in August from the previous month, as a decline in demand from manufacturers outweighed an increase from nonmanufacturers, leading the government to downgrade its assessment, official data showed Wednesday.
The orders, which exclude those for ships and from utilities because of their volatility, totaled 839.3 billion yen ($7.4 billion) following a 0.9 percent rise in July, according to the Cabinet Office.
The office downgraded its assessment for the first time since February, saying machinery orders, seen as a leading indicator of corporate capital spending, were showing "signs of stalling in their recovery." Until July, the office had said they had been showing "signs of picking up."
"Although we downgraded the view, the latest (Bank of Japan) Tankan business survey showed that capital spending plans of big companies have remained solid, so we expect the monthly decrease in machinery orders to be temporary," a government official told reporters.
Machinery orders from the manufacturing sector fell 13.4 percent to 373.2 billion yen, the first decrease in five months and the sharpest fall since a 26.6 percent decline marked in February 2016.
Sectors such as electrical machinery producers and general-purpose machinery firms saw sharp drops following gains in the previous month.
Orders from the nonmanufacturing sector grew 7.1 percent to 456.2 billion yen, following a 9.5 percent slide in July, underpinned by solid demand for information technology systems including next-generation 5G networks from wholesalers and retailers as well as telecommunication service providers, the official said.
Total orders stood at 2.7 trillion yen, down 7.8 percent, after growing 11.7 percent in July. Among them, orders from overseas, seen as an indicator of future exports, decreased 14.7 percent to 1.3 trillion yen, following a 24.1 percent jump the previous month.
Those from the public sector edged down 1.3 percent to 289.7 billion yen. They rose 14.0 percent in July.
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