April 2024 Machinery Orders

◆According to statistics for machinery orders in April 2024, private-sector orders (excluding ships and electric power) declined for the first time in three months by -2.9% m/m. While orders declined significantly for manufacturing due to a reactionary decline in response to the previous month’s performance, non-manufacturing (excluding ships and electric power) achieved growth in orders. The Cabinet Office left its assessment for machinery orders unchanged at “showing signs of picking up.”

◆Manufacturing orders declined for the first time in three months. Ship building, which registered a high during the previous month due to large projects (exceeding 10 bil yen), suffered a reactionary decline, thereby becoming the main source of negative performance. Meanwhile, non-manufacturing orders (excluding ships and electric power) grew for the first time in two months. The major factor bringing a boost to performance was growth in orders for the first time in two months for finance and insurance, and transportation and postal activities.

◆As for the future of private sector demand (excluding ships and electric power), performance is expected to continue marking time. Corporations are expected to be active in renewal investment and labor-saving investment with a strong appetite for capex spending. On the other hand, caution is recommended as capex could hit a low due to the risk of a slowdown in the US and Chinese economies.