Japan’s May core machinery orders fell 12.4% MoM, but a Norinchukin Research Institute economist said the decline mainly reflects a normalization after April’s 8.7% gain rather than a deterioration in investment fundamentals. He cited robust corporate profits, AI-related spending, labour shortages and market expectations for Prime Minister Sanae Takaichi’s growth agenda as ongoing support for capital expenditure, and added that if tensions with Iran ease, machinery orders and other capex indicat

Japan’s May core machinery orders fell 12.4% MoM, but a Norinchukin Research Institute economist said the decline mainly reflects a normalization after April’s 8.7% gain rather than a deterioration in investment fundamentals. He cited robust corporate profits, AI-related spending, labour shortages and market expectations for Prime Minister Sanae Takaichi’s growth agenda as ongoing support for capital expenditure, and added that if tensions with Iran ease, machinery orders and other capex indicators are likely to remain firm.