Japan core machinery orders down 13%

Japanese core machinery orders tumbled significantly in January, suggesting that despite Shinzo Abe's pledge to do whatever it takes to boost the economy, investors and manufacturers are still concerned over nation's future economic performance. A gauge of machinery orders, which excludes ships and utilities, dropped 13.1% in January from the previous month, posting first decline in four months. The fall was much larger than a median forecast of a 1.4% decline and was even further from previous month's reading of a 2.8% rally. On a yearly basis, core machine orders dropped 9.7%, also missing expectations for a modest 0.3% fall, following a 3.4% contraction in the previous month. The latest data are highlighting challenges faced by the government, as Japan's economic recovery has yet to gain momentum amid recession in Europe and slower growth in China.

"It's a good time to be BOJ governor because Kuroda can say Japan is making progress toward ending deflation when he adds more stimulus," said Miyamae of SMBC.