Japan machinery orders to rebound in Oct but coronavirus clouds outlook - Reuters poll
TOKYO (Reuters) - Japan's core machine orders likely rebounded in October along with demand for Japanese exports, a Reuters poll showed on Friday, but a resurgence in coronavirus cases at home and abroad could dampen the economic outlook.
Core machinery orders, widely considered an indicator of capital spending in the next six to nine months, likely rose 2.8% in October from the previous month, when orders fell 4.4%, according to the poll of 18 economists.
But the highly volatile data due on Wednesday is expected to show core orders, excluding those for ships and electrical utilities, likely dropped 11.3% in October from a year earlier after falling 11.5% year-on-year in September.
Japan's economy rebounded sharply in the third quarter from its biggest postwar slump but a resurgence in coronavirus cases has clouded the outlook of the world's third-largest economy.
"Machinery orders in the manufacturing sector likely grew led by a recovery in exports," said Yusuke Shimoda, senior economist at Japan Research Institute.
"But such gains will be limited because firms remained cautious about capital spending as the outlook uncertainty remains strong."
Revised data was expected to show gross domestic product expanded an annualised 21.5% in the July-September period, which would be a record growth, little changed from an initial reading of 21.4% growth, the poll showed.
The revised data would translate into 5.0% quarter-on-quarter growth, the same as the initial estimate.
Capital spending, a key component of GDP, likely eased 3.2% in the third quarter, little changed from a 3.4% fall in a preliminary reading, the poll showed.
Household spending likely rose 2.5% in October from a year earlier, the poll showed, rebounding from a 10.2% drop in September.
The government's domestic travel campaign aimed at reviving tourism likely helped consumer spending in the services sector, analysts said, but the coronavirus could hamper a recovery in spending going forward.
(Reporting by Kaori Kaneko; Editing by Ana Nicolaci da Costa)
