Japan's February Mor Likely Shrank

Japan will release February machinery orders (MoR) and March PPI inflation on 13 April. The MoR is expected to have declined by 2.0% m/m in February after dropping 1.7% m/m in January. "Exports and industrial production contracted m/m in February partly due to sluggish external demand; we think the MoR will follow a similar trend as it is an indicator of business capex. PPI inflation likely continued slowing in March, to 0.4% y/y from 0.5% y/y in February", says Standard Chartered Excluding the sales tax effect, PPI inflation likely dropped by 2.5ppt y/y in March. Prices in the energy sector contracted significantly in the first two months of 2015. The trend is likely to continue in March and put downward pressure on domestic PPI inflation.

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