Japanese machinery orders tumbled by the most in almost two years in May as companies grew more cautious about the business outlook due to a rising yen and signs of a global economic slowdown.
Bank lending also fell last month, matching the biggest annual decline in almost five years, as demand from companies for funds to invest in plants and equipment remained sluggish.
Bank of Japan Governor Masaaki Shirakawa stuck to the central bank’s view that Japan’s economy was showing further signs of a moderate recovery, but he and other market watchers voiced concerns about the potential fallout from Europe’s debt woes.
A senior government official said there was a risk Japan’s economy may enter a lull, after service sector sentiment worsened for two straight months last month.
“Europe’s financial problems haven’t had an impact yet, but companies are applying the brakes now,” said Tetsuro Sawano, a senior fixed-income strategist at Mitsubishi UFJ Morgan Stanley Securities in Tokyo.
Core private-sector machinery orders, a highly volatile series regarded as an indicator of capital spending, fell 9.1 percent in May, the biggest decline since August 2008 and far more than the median market forecast for a 3.1 percent decline. Worries about Europe’s debt problems and the health of the global recovery have helped push the yen up more than 5 percent against the US dollar this year as investors shun riskier assets, which could hurt business sentiment, economists say.
The US dollar stood around ¥88.30 yesterday, edging off a seven-month low of ¥86.96 hit at the start of the month.
Machinery orders from manufacturers fell 13.5 percent in May, faster than a 5.5 percent decline the previous month.
Keisuke Tsumura, parliamentary secretary of the Cabinet Office, said the recovery in capital spending could be slower than anticipated.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy