Capital spending up in Japan

Japan’s core machinery orders rose more than expected in April, official data showed yesterday, suggesting that rebuilding from last year’s earthquake will offset some of the pain from a strong yen and Europe’s debt crisis to support the fragile economy. The 5.7 per cent rise in core orders, a leading indicator of capital spending, was more than the median forecast for a 2.1 per cent gain and followed a 2.8 per cent drop in March, data from the Cabinet Office showed. The data underscores the Bank of Japan’s view that robust domestic demand will help the economy toward a moderate recovery. But policymakers have little to cheer about with the outlook clouded by slowing Chinese growth.