Japan’s exports posted their smallest decrease in 14 months last month as robust Asian demand bolstered hopes a recovery in trade will avoid another recession in the world’s second-biggest economy.
Exports, a mainstay of Japan’s economy, fell 6.2 percent to ¥5 trillion (US$55 billion) from a year earlier, the finance ministry said yesterday. In October, exports fell 23.2 percent.
The smaller decline in exports is a rare of piece of encouraging news for an economy struggling to find its footing amid a strong yen and deflation. Government spending measures around the world have helped fuel demand for Japan’s cars, gadgets and machinery.
Goldman Sachs economist Chiwoong Lee said the figures suggested that the turnaround in exports is sustainable.
“The likely pattern for the Japanese economy is an underpinning from exports and related capex as domestic demand crumbles due to the loss of policy stimulus,” Lee said.
Emerging from recession, Japan’s economy expanded at an annualized pace of 1.3 percent in the July to September quarter. Since then, however, the economy has come under increasing pressure from deflation and a stronger yen, which reduces the value of exporters’ earnings abroad.
A survey in the Nikkei Shimbun yesterday showed that nearly half of business leaders polled worry that Japan will fall back into recession next year. The heads of 140 major Japanese firms in the survey cited the appreciating yen and the waning impact of economic stimulus steps.
With imports down 16.8 percent from a year earlier to ¥4.6 trillion, Japan posted a trade surplus of ¥374 billion for last month.
Among key regions, Japan’s shipments to the US fell 7.9 percent for the 27th straight drop, but the fall was far less severe than previous months. Japanese exports to the EU fell 15.9 percent.
Asia-bound exports, meanwhile, increased 4.7 percent, led by electrical equipment, general machinery and motor vehicles.
Shipments to Taiwan jumped almost 17 percent, while those to China expanded 7.8 percent.
Japan’s neighbors have become increasingly vital to Japan’s economy. Exports to the rest of Asia totaled ¥2.7 trillion — more than those to North America (¥920 billion) and Western Europe (¥624 billion) combined.
In related news, Japan logged a trade surplus for the 10th straight month last month, backed by recovering demand from the US and China, data showed Monday.
Japan posted a surplus of ¥373.93 billion last month, reversing the year-before deficit of ¥227.51 billion and above market expectations of ¥319 billion.
Against the US, Japan’s surplus grew 10.6 percent to ¥404.54 billion, the first rise in 27 months, thanks to higher exports of automobiles and heavy machinery, the finance ministry said.
Japan’s surplus with the rest of Asia nearly quadrupled to ¥626.94 billion. Imports from Asia fell 14.1 percent. With China alone, Japan’s deficit shrank by 62.3 percent to ¥119.97 billion.
Japan’s trade surplus with the EU tumbled 39.8 percent to ¥106.48 billion.
RSS