Slight recovery in Japanese exports
Japan's exports showed modest signs of recovery in April with shipments to China declining at a slower pace than a year earlier.
Exports rose for a second month in April compared to the previous month, seasonally adjusted government data showed today, an encouraging sign as Japan's economy recovers from its worst ever contraction, although it remains to be seen how sustainable the recovery is.
Shipments to China, Japan's biggest trade partner, fell 25.8 per cent last month from a year earlier, narrowing the margin of annual decline for a third straight month and showing that Beijing's $585 billion stimulus package is helping slow the pace of decline in shipments of Japanese cars and consumer electronics.
The data also showed that Japanese exports of machinery fell at a faster pace, suggesting the absence of a rise in final demand that would prompt China's factories to gear up.
Overall Japanese exports fell 39.1 per cent in April from a year earlier, less than the median market forecast for a 41.9 per cent fall. On a seasonally adjusted basis, exports rose 1.9 per cent last month from March.
According to separate data from the Bank of Japan released today, seasonally adjusted exports rose 7.8 per cent in April from the previous month, the biggest gain in 14 years.
The pace of annual declines in exports of cars and electronic parts is slowing overall, showing that trade is improving, a Ministry of Finance official told reporters at a briefing.
Exports to China of mobile phones rose 14.3 pe rcent in April from a year earlier as China's stimulus package filtered through the economy. Car exports to China fell 46.7 per cent lst month from the previous year, also slower than last month's 54.5 per cent decline. However, machinery shipments posted a 36.0 per cent annual slump in April, faster than a 30 per cent annual decline in March.
Sentiment has also begun to turn around in Japan's largest Western markets. US consumer confidence soared in May to the highest level in eight months as an improving labour market made people more optimistic about buying cars, data showed yesterday. In Germany, the Ifo business sentiment survey rose in April in a sign a record slump in exports and investment is easing.
Japanese exports to the United States fell 46.3 per cent in April from a year earlier, smaller than a 51.4 per cent drop in March, although automobile shipments continued to fall sharply, dropping 70 per cent from a year earlier.
The trade balance logged a surplus of 69.0 billion yen, higher than the median estimate for a 57.5 billion yen shortfall.
Japan's government raised its assessment of the economy for the first time in three years on Monday, saying the pace of deterioration in exports and industrial production is slowing.
The government joined the Bank of Japan, which also upgraded its view of the economy this month for the first time in almost three years.
Japan's economy shrank at a record 4 per ent in the first quarter as domestic demand and investment buckled, and some economists say a recovery depends on whether final demand picks up overseas.