Japan’s exports snap four-month slump helped by China demand
[TOKYO] Japan’s exports rose for the first time in five months in September, data showed on Wednesday, although US shipments continued to fall despite lower US tariffs on Japanese goods that took effect in the month.
The uptick in exports adds to a string of recent data, including the Bank of Japan’s tankan business survey, that support a growing view within the central bank that the economy is weathering the impact of earlier tariff hikes.
Total exports by value rose 4.2 per cent year-on-year in September, data showed, less than a median market forecast for a 4.6 per cent increase and following a 0.1 per cent drop in August.
Exports to the United States fell 13.3 per cent in September from a year earlier, while those to China were up 5.8 per cent, the data showed.
Imports grew 3.3 per cent in September from a year earlier, compared with market forecasts for a 0.6 per cent increase.
As a result, Japan ran a trade deficit of 234.6 billion yen (S$2 billion) in September, compared with the forecast for a surplus of 22.2 billion yen.
Washington formalised a trade agreement with Tokyo last month, implementing a baseline 15 per cent tariff on nearly all Japanese imports, down from the initial 27.5 per cent on autos and a 25 per cent duty threatened for most other goods.
The deal gave some relief to Japanese automakers and other exporters, many of whom had absorbed higher tariff costs by cutting export prices to stay competitive at the expense of profits.
Analysts have cautioned that the prolonged squeeze on profits could dampen corporate investment and wage growth.
BOJ Governor Kazuo Ueda has signalled the bank’s readiness to keep raising still-low borrowing costs if there are enough signs that Japanese firms can weather the tariff hit and boost spending on equipment and wages. REUTERS
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