Japans Q1 Capex Falls for 4th Straight Quarter

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Q1 capex 7.8 yryr, seasonallyadjusted 0.4 qtrqtr

Manufacturers capex 6.4 yryr, nonmanufacturers 8.5

Ordinary profits 26.0 yryr, sales 3.0

TOKYO, June 1 Reuters Japanese companies cut spending on plant and equipment for the fourth consecutive quarter in JanuaryMarch, as the economy struggles to shake off the drag from the coronavirus pandemic.

A slow recovery of firms propensity to spend is likely to worry policymakers hoping strong domestic demand can help make the countrys economic recovery more sustainable.

Ministry of Finance MOF data out on Tuesday showed capital expenditure in the first quarter fell 7.8 from the same period last year, pulled down by weaker investments in transportation equipment, electrical machinery and real estate.

It marked the fourth quarter of an annual decline in capital expenditure in a row, after posting a 4.8 contraction the final quarter of last year.

The worlds thirdlargest economy slumped back into decline in the first quarter as a slow vaccine rollout and repeated emergency curbs put in place to halt a resurgence of infections hurt domestic demand.

After bouncing from last years slump, driven by a strong recovery of exports, some analysts worry Japans economy could slip back into recession in the current quarter due to extended coronavirus curbs.

A preliminary estimate found Japans economy shrank an annualised 5.1 in the first quarter as households curtailed spending following a resurgence of infections and export growth…

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