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Japan's exports fall most in 2 years as Asian shipments weaken
[TOKYO] Japan's exports posted their biggest decline in more than two years in January, adding to concerns about slowing global demand and trade frictions as business confidence softens and orders for the country's machinery goods fell sharply.
Ministry of Finance data out on Wednesday showed Japan's exports fell 8.4 per cent in the year to January, versus a 5.5 per cent annual drop expected by economists in a Reuters poll. It was the sharpest annual decline since October 2016, and followed a revised 3.9 per cent year-on-year drop last December.
The data came after a key gauge of Japanese capital spending showed overseas orders for machinery fell the most in more than a decade in December, and business sentiment soured to a two-year low, as trade friction hampered global supply chain demand.
Global trade has slowed as Washington and Beijing have been locked in a tit-for-tat tariff battle for months, which could have ripple effects on Japan's export-focused economy.
US President Donald Trump said on Tuesday that trade talks with China in Washington this week were progressing well and suggested he was open to pushing off the deadline to complete negotiations. Japanese exports to China, Japan's biggest trading partner, fell 17.4 per cent in the year to January.
Slowing shipments ahead of Chinese New Year holidays likely helped slow China-bound exports, finance ministry officials said. Japan's shipments to Asia, which account for more than half of overall exports, fell 13.1 per cent in January.
US-bound exports rose 6.8 per cent in the year to January, led by shipments of cars. Japan's imports from the United States rose 7.7 per cent in the year to January, led by crude oil. Japan's trade surplus with the United States rose 5.1 per cent to 367.4 billion yen (S$4.5 billion). It was the first increase in seven months.
The US Commerce Department sent a report on Sunday to US President Donald Trump that could unleash steep tariffs on imported cars and auto parts.
Imports of Japanese cars make up about two-thirds of Japan's US$69 billion annual trade surplus with the United States, making Tokyo as well as Beijing a target of criticism by Trump.
In January, US-bound auto shipments grew 23.2 per cent in January to 139,579 units, the trade data showed. Japan's overall imports fell 0.6 per cent from a year earlier, a smaller decline than the median estimate for a 2.8 per cent decrease.
The trade balance came to a deficit of 1.4152 trillion yen, versus a 1.011 trillion yen shortfall seen by economists.