Japan capex grows

    JAPANESE corporate capital expenditures grew in January-March at the fastest pace in a year, adding to hopes that a recovery in business investment will spur growth in the world’s third-largest economy.

    Corporate spending on plants and equipment, along with wage growth, hold the key to the ultimate success of Prime Minister Shinzo Abe’s economic reflationary policy recipe aimed at generating a virtuous cycle of private-sector-led growth. The 7.3 percent year-on-year increase in capital spending in the first quarter followed a 2.8 percent annual gain in October-December, data by the Ministry of Finance showed yesterday.

    Russian PMI falls

    RUSSIAN manufacturing activity shrank to a four-month low in May, the HSBC purchasing managers’ index (PMI) showed yesterday, adding to evidence that the economy remains weak.

    The index’s headline reading fell to 47.6 from 48.9 in the previous month, slipping further below the 50.0 mark that separates expansion from contraction.

    Ukraine growth

    THE International Monetary Fund (IMF) said late Sunday it has lowered its growth forecast for Ukraine’s war battered economy to minus nine percent, due in large part to “the unresolved conflict in the East.”

    The dismal projection — down from a forecast in April of minus 5 percent — followed a two-week-long visit by an IMF delegation to Kiev last month.

    U.K. growth

    BRITAIN’S manufacturing sector is likely to grow less this year than previously thought due to reduced investment by oil and gas companies, the country’s main trade association for manufacturers said yesterday.

    The EEF cut its forecast for manufacturing growth in 2015 to 1.5 percent from 1.7 percent, barely half last year’s 2.9 percent growth rate. “Much of this weakening is down to the impact of the decline in oil and gas activity on the supply chain,” Lee Hopley, the EEF’s chief economist, said.

    Italy PMI

    ITALIAN manufacturing activity expanded at its fastest in more than four years in May, a survey showed yesterday, fuelling hopes of a recovery in the eurozone’s third-largest economy.

    A sharp rise in new export orders helped propel the Markit/ADACI Purchasing Managers Index (PMI) to 54.8 from April’s 53.8, its highest since April 2011 and its fourth consecutive month above the 50 mark that separates growth from contraction.