Japan’s exports fell for a sixth straight month last month, sapped by weak shipments of machinery and chemicals, though a sharper decline in imports helped push the trade surplus to its highest level in more than five years.
Customs data reported yesterday showed exports fell 6.8 percent last month from a year earlier to ¥6.46 trillion (US$59.2 billion) while imports sank 14.9 percent to ¥5.7 trillion.
The resulting balance of ¥754 billion was the highest since October 2010.
Imports of coal, oil, food and machinery dropped. The change was exaggerated by a recent 10 percent surge in the yen’s value against the US dollar, to about ¥109. That makes import costs lower in yen terms.
Japan is also importing more lower-cost food items from China, while reducing imports of US-produced soybeans, meats and grains.
Vehicle shipments to the US, which account for 40 percent of Japan’s exports to the US, rose 6.4 percent.
In value terms, worldwide exports of machinery, electrical machinery and chemicals fell at double-digit paces.
Slack global demand and the slowdown in China, Japan’s second-biggest export market after the US, have dragged on exports, slowing the recovery.
Japan’s exports to China dropped 7 percent last month, mainly due to drops in shipments of electrical machinery and chemicals.
The slower growth in China has also hit other Asian markets, hurting Japan’s exports to other countries.
Recent improvements in the global outlook would likely lift exports soon, economists said.
However, a stronger yen reduces profits earned in dollar terms when they are repatriated. That is a discouraging trend for companies that in recent years have benefited from a weakening of the yen against the US dollar.
“For now though, the slump in export values is lowering firms’ revenues and might undermine their willingness to expand capacity and lift wages,” Capital Economics analyst Marcel Thieliant said.
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