"Growing uncertainties over the global economy and the yen's gains could discourage companies [from spending]"
- Yoshiki Shinke, a senior economist at Dai-Ichi Life Research
Japan's machinery orders tumbled in December as the debt crisis in Europe and strong yen dimmed the outlook for exporters. Month-on-month bookings fell 7.1 per cent in December, after surging 15 per cent in November, said the Cabinet Office on Thursday.
"Growing uncertainties over the global economy and the yen's gains could discourage companies" from spending, said Yoshiki Shinke, a senior economist at Dai-Ichi Life Research in Tokyo.
At the same time "it's unlikely that capital spending will turn into a declining trend in coming months because of reconstruction demand," he said.
"Falls in machinery orders in December and October-December were within expectations and unsurprising. Given uncertainty over the global economy, corporations held back their capital expenditure plans," said Yoshimasa Maruyama, chief economist at Itochu Economic Research Institute in Tokyo.
© Dukascopy Bank