Japan: Exports pick up in July but trade surplus still narrows
August 17, 2017
Nominal exports valued in yen increased 13.4% from the same month last year in July, following June’s 9.7% increase. The print slightly undershot the 13.6% increase that market analysts had expected. The acceleration was driven by growing sales to the rest of Asia, which rose 14.8%, and a pickup in shipments to North America, which went up from a 7.8% increase in June to 13.0% in July.
Imports accelerated a little less than exports, rising 16.3% annually in July compared to June’s 15.5% increase. The print undershot the 17.0% rise that markets had expected. While resilient domestic activity is supporting strong imports growth— economic output accelerated at a seasonally-adjusted annualized rate of 4.0% in Q2—the external sector is benefiting from a weak yen and stable global demand.
As a result of the higher increase in imports, the trade surplus narrowed from JPY 505 billion in July 2016 to JPY 419 billion in July 2017. Accordingly, in the 12 months leading up to July, the trade surplus inched down to JPY 3.2 trillion, which was lower than the JPY 3.3 trillion surplus recorded in the previous month.
Author: Edward Gardner, Economist