Tokyo, Jan. 14 (Bloomberg) -- Japanese machinery orders, an early indicator of business investment, unexpectedly fell in November as companies such NTT DoCoMo Inc. limit spending in anticipation of a slowing economy. Machinery orders, excluding shipping and utility companies, fell 0.2 percent from October, seasonally adjusted, to 828.1 billion yen ($6.97 billion), the Cabinet office said. Orders had been expected to rise 1.8 percent, according to the median forecast of 26 economists in a Bloomberg News survey. Business investment, which accounts for 15 percent of the world's second-biggest economy, fell 0.5 percent in the third quarter, limiting growth. Tax cuts for research and development planned for the year starting April 1 may not be enough to prompt companies to spend more, economists said.
``Capital spending will fall as the economy slows,'' said Mikihiro Matsuoka, a senior economist at Deutsche Securities Ltd. ``Tax cuts to businesses aren't really going to spur spending, as there just aren't companies that have the luxury to do so under current economic conditions.'' The No. 245 bond, which carries a 0.9 percent coupon and matures in 2012, rose 0.092 to 100.410 as of 2:24 p.m. in Tokyo. Its yield fell one basis point to 0.855 percent. A basis point is 0.01 percentage point. NTT DoCoMo Inc., the world's second-largest mobile-phone operator, said it would cap spending on new equipment next fiscal year at current levels because expansion wouldn't bolster its high- speed wireless Internet service. From a year earlier, machinery orders fell 7.2 percent.//www.quote.bloomberg.com