A typical mid-month Monday - very quiet with very little to report. Still, the highlight of the day was probably Sept's orders for Japan's machine tool orders. Although these fell 15% yoy, the monthly movt was actually 2.1SDs above historic seasonal trends. This follows on from monthly gains sharply higher than trend for July, July and August. Right now the 6m deflection against trend is running at 0.9SDs above trend, which is the highest since early 2014. The problem, of course, is that the base of comparison is so low now, that even this strong run hasn't been enough to rescue the yoy. The 12m yoy is still running down 35.4% yoy, and this comes after a fall of 32.3% in calendar 2019.
Still, you've got to take your surprises where you can get them. And here the surprise is in foreign orders, which were actually up - yes, up - 1.8% yoy in September, which was the first yoy gain for two years, with a monthly movt 1.3SDs above trend. Domestic orders, meanwhile, are still down 34.3% yoy, although the monthly movt was 1.2SDs above trend.
Machine tool orders are literally the cutting edge of the industrial cycle, and so we can probably say that whilst there's signs of life ex-=Japan, there's really not sign that we're going to break into positive territory domestically in Japan any time soon.
