Japan Machinery Orders Slide 3.3%

Japan’s machinery orders fell more than expected in August, a sign that companies will cut back spending as global demand slows. Orders, an indicator of capital spending in three to six months, declined 3.3 percent after rising 4.6 percent in July, the Cabinet Office said today in Tokyo. The median of 26 estimates in a Bloomberg News survey was for a 2.3 percent drop.

Today’s data follow government reports last month showing declines in industrial output and exports, underscoring the risk of a contraction in gross domestic product. In an interview in Tokyo, Japanese Prime Minister Yoshihiko Noda yesterday called for talks to contain economic damage from a dispute with China over East China Sea islands.

“There’s a growing number of people who are pessimistic about the economic outlook,” Jun Kawakami, an economist at Mizuho Securities Co. in Tokyo, said before the report. “It’s really hard to see any signs that companies will increase capital spending.” Read more >>

China sends 1,000 boats armada to disputed island chain

Around 1,000 fishing boats have been mobilised by China to sail to an island chain controlled by Japan, as the quarrel between the two countries fuelled a seventh day of protests.

Chinese fishing boats, which often seem suspiciously well-drilled and organised, have clashed with the Japanese coastguard over the Diaoyu, or Senkaku, islands before, but never in such numbers. They were expected to arrive on Monday night, according to the state-run China News Service, and may also be joined by six Chinese maritime patrol ships, which briefly entered Japanese waters last Friday in a show of defiance.

The spat over the islands, which has been rumbling for decades, intensified last week after Japan announced it had bought some of the archipelago for the nation from a private Japanese family. Read more >>