Japan's Q2 capex rises 4.6% year/year, up for 5th quarter

TOKYO : Japanese companies increased spending on plant and equipment for a fifth straight quarter in April-June as business sentiment remained resilient despite rising costs, China's COVID lockdowns and supply chain disruptions.

Robust corporate spending is offering some encouragement for Japan's growth outlook even as a global economic slowdown and domestic COVID-19 flare-ups threaten to weigh on near-term demand.

Capital expenditure in the second quarter rose 4.6 per cent from the same period last year, Ministry of Finance (MOF) data showed on Thursday.

The pace of spending picked up from a 3.0 per cent year-on-year increase in the first three months of this year.

The data will be used to calculate revised gross domestic product figures due on Sept. 8. A preliminary estimate last month showed the world's third-largest economy expanded by a slower-than-expected annualised 2.2 per cent in the second quarter.

Manufacturers' business spending advanced 13.7 per cent from a year earlier, the MOF data showed.

On a seasonally-adjusted quarterly basis, capital expenditure expanded 3.9 per cent in April-June from the prior quarter.

Corporate recurring profits rose 17.6 per cent in the second quarter from a year earlier, while sales were up 7.2 per cent, the data also showed.