Japan’s exports fall for 12th month as shipments to US, China drop
Aerial view of Osaka. View on the Osaka Bay and its port on March 28, 2015 in Osaka, Japan.
Frédéric Soltan | Corbis News | Getty Images
Japan’s exports slipped for a 12th straight month in November, as declining shipments to the United States and China hit the trade-reliant economy, raising the risk of a fourth-quarter contraction.
Official data released on Wednesday showed Japan’s exports fell 7.9% year-on-year in November, a smaller decline than the 8.6% decline expected by economists in a Reuters poll.
The gloomy reading, driven by fewer shipments of cars and construction machinery to the United States and chemical products to China, marked the longest run of declines in exports since a 14-month stretch to November 2016.
In volume terms, exports dropped 5.0% in the year to November, the fourth consecutive month of declines.
Japan’s economy grew at a much faster pace than initially reported in the third quarter, data showed last week, largely thanks to improvements in business spending and private consumption.
But there are worries the third-quarter strength is masking widening cracks in the economy after the government went ahead with a nationwide tax hike in October, giving a big hit to corporate and household sentiment.
Industrial output slipped at the fastest pace in nearly two years in October while retail sales and household spending slumped after consumers tightened their purse strings following the sales tax hike.
The Bank of Japan is seen keeping monetary policy on hold at its two-day policy meeting ending on Thursday as progress on U.S.-China trade and a $122 billion fiscal package at home to took some pressure off the central bank to support growth.
By region, exports to China, Japan’s biggest trading partner, lost 5.4% year-on-year in November, down for the ninth month as shipments of chemicals and car parts declined.
Exports to Asia, which account for more than half of Japan’s overall exports, dropped 5.7% in the year to November largely due to declining shipments of flat rollers to Thailand.
Japan’s shipments to the United States declined for the fourth straight month, falling 12.9% in the year to November, hurt by reduced shipments of cars, construction machinery and car parts.
The nation’s overall imports sank 15.7% year-on-year, marking their largest decline since Oct. 2016, and a larger fall than the median estimate for a 12.7% decrease.
The trade balance posted a deficit of 82.1 billion yen, versus a 369.0 billion yen shortfall seen by economists.