Firms increased spending at a slower pace after the nation's largest quake on record and tsunami knocked out power stations and shut down factories.
Capital spending excluding software rose 4.2 percent in the three months that ended on March 31 from a year earlier, after increasing 4.8 percent in the previous quarter, the Finance Ministry said Thursday. From the previous quarter, outlays fell 0.2 percent.
The report adds to evidence of the damage the temblor has inflicted on companies, whose outlays helped propel the nation's recovery in 2009 following the global financial crisis. Sony Corp. is forecasting profits below analysts' estimates, while Panasonic Corp. said its earnings were "extremely affected" by the March 11 disaster.