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Japanese corporate capital expenditure in April-June jumped by its most since 2006, raising hopes for sustainable economic recovery led by the private sector, although global trade tensions cloud the outlook for an export-reliant economy.

Ministry of Finance (MOF) data out on Monday showed capital expenditure in the second quarter rose 12.8 percent from the same period last year, led by investment in the production of cars and electronics.

It marked a seventh straight quarter of annual growth in capital expenditure after posting 3.4 percent gain in the previous quarter. It was the sharpest annual gain since 2006.

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Capital expenditure excluding software, grew 6.9 percent from the previous quarter on a seasonally-adjusted basis, rising for a fourth straight quarter and the fastest gain since 2011.

Capital expenditure has been a bright spot in Japan’s economy, the world’s third largest, as companies update their fixed assets and invest in automation and labor-saving technology to cope with labor shortages.

However, a major trade war stemming from commercial tensions between the United States and China could hit the world economy hard, which would in turn hurt Japan’s exports and discourage corporate investment.

The capex data will be used to calculate revised gross domestic product figures due on Sept. 10. A preliminary estimate found Japan’s economy grew by an annualized rate of 1.9 percent in the second quarter on solid household and business spending.

The preliminary GDP data showed capital expenditure rose 1.3 percent on the quarter, rising for a seventh straight quarter.

Monday’s capex data showed capital expenditure by manufacturers and non-manufacturers grew 19.8 percent and 9.2 percent respectively in the second quarter from a year earlier.

The data comes after a recent batch of soft indicators such as factory output and retail sales cast doubts over the strength of Japan’s growth in the current quarter.

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Corporate profits rose 17.9 percent in April-June from a year earlier, up for an eighth consecutive quarter, to a record 26.4 trillion yen ($237.67 billion), the data showed.

Sales rose 5.1 percent year-on-year in April-June, up for a seventh straight quarter.

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