Japanese machine tool orders increased for the 16th consecutive month in March to 113.36 billion yen, although the 49.5 percent growth from the year-ago level represented a slowdown from a 73.9 percent rise in February and 89.4 percent in January, the Japan Machine Tool Builders' Association said.

Domestic orders increased by 65.7 percent to 31.95 billion yen, slower compared to the 89.5 percent surge in February, said the association which also noted no major order cancellations after the severe earthquake and tsunami that battered a wide area on the northeastern coast of Japan's main Honshu island on March 11.

Trends in machine tool orders are widely watched in Japan as indicators of factory activity in manufacturing industries.

In recent years, however, overseas demand has comprised the bulk of Japanese machine tool orders. In 2010, according to association data, external demand accounted for nearly 70 percent of all orders.

In March, overseas orders amounted to 81.41 billion yen, with the growth rate of 43.9 percent slower against the 66.2 percent advance in February

 

At the start of the year, the association said demand from Asia, particularly China, would continue to drive the growth in overseas orders for Japan machine tools.

Total machine tool exports in 2010 came to 671.1 billion yen, up by 170 percent from the previous year, the association data showed.

Orders from China in 2010 came to 253 billion yen, accounting for nearly 38 percent of the total overseas demand.