"Manufacturers expect machinery orders to rise 5 percent in October-December, but given weakness in external demand, that may be tough to achieve as capital spending will weaken toward the year-end"
- Takeshi Minami, chief economist at Norinchukin Research Institute
Japanese machinery orders plunged unexpectedly in September, adding to concerns that the world's third biggest economy will almost certainly experience a recession by the end of this year. According to the Economic and Social Research Institute, orders, which is an indicator of capital spending in the nearest future, tumbled 4.3% from the previous month, hit by the weak domestic demand and exports. On the yearly basis, orders lost 7.8% in September.
"We are in the middle of a technical recession" of two consecutive quarters of contraction, Hiromichi Shirakawa, said chief Japan economist at Credit Suisse Group AG in Tokyo.
"Manufacturers expect machinery orders to rise 5 percent in October-December, but given weakness in external demand, that may be tough to achieve as capital spending will weaken toward the year-end," said Takeshi Minami, chief economist at Norinchukin Research Institute in Tokyo.
The Nikkei 225 Stock Average tumbled 0.83 per cent, or 72.99 points, to 8,764.16. The broader Topix Index retreated 0.57 per cent, or 4.21 points, to 731.14.
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