Japan core machinery orders slump

Core machinery orders are a good indicator of capital spending in Japan, and May's unexpected drop is signaling that recent upbeat economic data are not convincing companies in the world's second largest-economy that now is the time to raise outlays.

Orders fell 3.0% in May, the seventh drop in eight months, versus the forecast of roughly a 2% rise. Manufacturing reports have suggested a degree of strength, but the Tankan survey, a closely-followed look at business confidence, rose less than expected in 2Q. And it is beginning to appear that an expected rebound in 2Q GDP may be short-lived.