"Japan's economy can emerge from recession in the first quarter as consumer spending and exports are expected to pick up"
- Yasuo Yamamoto, senior economist at Mizuho Research Institute
Japanese machine orders dropped in November, suggesting investors are getting more anxious over the future economic performance, the Japan Machine Tool Builders' Association said. A gauge, which indicates business conditions and the overall economic condition in the country, fell to -21.3% last month, down from -6.7% in the prior month. As the small number of tool orders came out, the investor sentiment is expected to deteriorate. Previous week's report showed that core machinery orders, which exclude orders for ships and electric power utilities, rose for the first time in three months in October. Core machinery orders added 2.6% in October from September, when they had fallen 4.3%. Despite the fact, the data are sending mixed signals, uncertainty over the economic outlook is likely to continue to weigh on business investment.
"Japan's economy can emerge from recession in the first quarter as consumer spending and exports are expected to pick up," said Yasuo Yamamoto, senior economist at Mizuho Research Institute. "But in order for growth to accelerate even further, capital expenditure needs to improve. Unfortunately, capital expenditure is likely to remain weak."
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