Machinery orders, a key indicator of corporate spending plans, rose at triple the pace economists predicted for May, reinforcing expectations the Bank of Japan will raise interest rates as soon as next month.
Orders climbed a seasonally adjusted 5.9 percent in May from the previous month, the Cabinet Office said Monday, the second straight monthly gain. The median estimate of 32 economists surveyed by Bloomberg News was for 1.9 percent.
Manufacturing equipment orders rose at their fastest pace in almost a year, signaling industrial production is likely to recover. Two BOJ policymakers said last week that keeping borrowing costs, the lowest among major economies, unchanged for too long could hurt economic growth in the long run.