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Japan exports rise more than forecast, paring record deficit
[TOKYO] Japan's exports rose more than forecast in December, paring a record annual trade deficit caused by energy purchases and a surge in imports before April's sales-tax increase.
Overseas shipments rose 12.9 per cent from a year earlier, the finance ministry reported Monday, compared with the median estimate for a 11.2 per cent gain in a Bloomberg News survey. Imports gained 1.9 per cent, leaving a deficit of 660.7 billion yen (US$5.6 billion). The annual shortfall widened to a record 12.8 trillion yen in 2014 from the previous year's 11.5 trillion yen.
Stronger exports should support an economy that contracted last year after consumers cut spending following a tax rise. The Bank of Japan last week raised its forecast for growth in the year starting April, with the bank's Governor Haruhiko Kuroda saying slumping oil prices will boost growth.
"Exports are growing clearly, especially to Asian countries excluding China," Hiroshi Watanabe, an economist at SMBC Nikko Securities Inc. in Tokyo, said before the data was released. "There is no doubt that external demand will contribute positively to Japan's economic growth." Exports to the US rose 24 per cent, while those to the EU climbed 6.8 per cent and shipments to China were up 4.3 per cent.
The annual deficit widened for a third straight year. Japan's trade balance turned negative in 2011 for the first time in more than three decades following a surge in fossil-fuel imports after the nation's nuclear power plants were shut down.
The drop in oil prices may ameliorate that, with JPMorgan Chase and Co. forecasting a return to a trade surplus in 2015.