FX.co ★ Japan Machinery Orders Fall More than Expected

Japan’s core machinery orders—excluding volatile categories such as ships and electric utilities—declined by 3.7% month-on-month to JPY 1,016.9 billion in July 2026. The drop was steeper than the market consensus for a 2.8% decrease and followed a strong 9.7% rise in the previous month. This was the fourth monthly decline so far this year.

The weakness was broad-based. Manufacturing orders fell 1.0% to JPY 518.6 billion, while non-manufacturing orders excluding utilities decreased 2.6% to JPY 525.9 billion. Within manufacturing, the sharpest contractions came from non-ferrous metals (-82.2%), other transport equipment (-41.4%), and chemicals and chemical products (-12.0%). In the non-manufacturing sector, real estate (-26.4%), telecommunications (-23.2%), and information services (-16.9%) recorded particularly notable declines.

On a year-on-year basis, core machinery orders rose 11.2%. Although still solid, this undershot market expectations for a 15.3% increase and represented a slowdown from the prior period’s four-month high of 16.9% growth.