Japan: Exports contract the most in 16 months
October 22, 2012
In September, exports contracted 10.3% over the same month last year, which nearly doubled the 5.8% drop seen in August. In fact, the reading, which exceeded market expectations of a 9.9% decline, marked the steepest fall seen since May 2011. Exports deteriorated partially due to escalating tensions with China, along with faltering global demand. Simultaneously, imports rose 4.1% in September, contrasting the 5.4% drop tallied in the previous month and overshooting market expectations that had shipments rising 2.9%. Imports were spurred by soaring purchases of oil and liquefied natural gas (LNG) ahead of the announced tax rise on oil derivatives, coal and gas on 1 October. As a result, the trade balance registered a deficit of JPY 559 billion (USD 7.0 billion), which contrasted the JPY 289 billion surplus recorded in the same month last year. That said, the print was broadly in line with market expectations of a JPY 548 billion deficit.