Japanese Machinery Orders Up... Still No Private Demand

Daily FX with the details (bold mine):

Japanese Machine Orders, when excluding ships and utilities, June rose by 9.7% in June, beating expectations of a 2.6% increase in the figure. The latest release is the highest of such since April of 2008. Last month'a release saw orders for such industrial needs contract by 3.0%. Most of the increase in demand in June came from abroad, growing 43.8% on the month.

The domestic public sector weighed in only slightly. Overall, when including orders for ships and utilities, total orders rose only 2.3% with private demand actually slipping by 15.9%. But it is important to strip the metric of boat orders because such expenditures are generally used for military or freighters. Still, it may somewhat worrisome to see such a substantial gap between the headline figure and the figure with the two excluded items.

Source: ESRI

Japanese Economy "Unexpectedly" Crumbling

I needed to throw unexpectedly in quotes. At this point is anything really "unexpected" in terms of downside surprise? Bloomberg reports:

Japanese machine orders unexpectedly fell for a third month and the current-account surplus narrowed because of plunging exports, stoking concern that the economy will struggle to emerge from its worst postwar recession.

“It’s still difficult to have any confidence that the economy’s rebound will continue through this year,” said Mari Iwashita, chief market economist at Daiwa Securities SMBC Co. in Tokyo. “Given the economy’s weakness, the Bank of Japan will probably decide to extend all of its emergency measures beyond their expiration at the end of September.”

In addition:

Exports tumbled 42.2 percent from a year earlier, a steeper drop than the previous month, causing the current account surplus to contract to 1.3 trillion yen ($13.8 billion). Imports fell 43.9 percent, the ministry said.

Source: ESRI