Japan’s machine tool orders fall below 130 billion yen for the first time in two months

The Japan Machine Tool Builders’ Association (JMTBA) has released preliminary figures for Japan’s machine tool orders in July 2025. Total orders amounted to 128.3 billion yen, a 3.6% decrease compared to June. 

With growing uncertainty—especially as negotiations between the U.S. and other countries intensified in late July, ahead of the U.S. tariff changes that came into effect on August 1—and the waning effect of end-of-quarter demand, total orders fell below 130 billion yen for the first time in two months. 

However, total orders increased year-on-year (YoY) for the first time in two months, staying above the 128.0-billion-yen level and reflecting a certain degree of resilience in capital investment demand. 

Domestic orders decline, but remain relatively high 

Domestic orders dropped 11.1% month-on-month (MoM) to 35.4 billion yen, partly due to the fading impact of subsidy-related demand. This marked the first MoM decline in two months and the fourth consecutive YoY decrease, indicating continued sluggishness in the domestic market. 

That said, the July total was the highest monthly figure so far this year excluding quarter-end months, suggesting a potential for gradual recovery in domestic demand from autumn onward. 

Foreign orders exceed 90 billion yen for fifth straight month 

Foreign orders totaled 92.9 billion yen, a slight 0.4% decrease from June, but remained above 90 billion yen for the fifth consecutive month. Compared to the same month last year, foreign orders increased for the 10th consecutive month, pointing to ongoing strong capital investment demand overseas. 

At the same time, however, persistent risks in all three major global regions continue to weigh on the outlook. Foreign orders have now recorded slight MoM declines for four straight months, reflecting a high yet somewhat stagnant trend. 

Further details will be provided in the final report.