In September, Japan’s exports plunged for the tenth month in a row and adding to the speculations that the country’s central bank would further ease monetary policy as soon as next week to support the economy.
The Ministry of Finance showed that September exports went down by 5.2% year-on-year due to the fall in shipments of car and airplane parts to the US and semiconductor production equipment to South Korea. Meanwhile, in volume terms, exports dropped by 2.3% year-on-year, the second month of fall in a row.
Exports to China, Japan’s biggest trade partner, slumped by 6.7% year-on-year and showed a fall for the seventh month due to a decline in auto parts shipments. Exports to Asia which account for more than half of the country’s overall exports, plunged by 7.8% year-on-year, dropping for the 11th month as semiconductor manufacturing parts shipment slid by 18.7%.
Imports from the US dropped by 11.6%, narrowing Japan’s trade surplus with the country by 3.5% year-on-year to JPY564.1 billion (USD5.2 billion).
Overall imports slumped by 1.5% year-on-year, more optimistic than the 2.8% decrease of estimations. In volume terms, imports rose by 6.8%, largely due to a front-load nationwide demand before a tax hike in October.
The country’s trade balance was at a JPY123.0 billion deficit (USD1.1 billion), way contrasting with a JPY54.0 billion (USD497.5 million) surplus estimated.
Analysts predicted that the Bank of Japan could ease the country’s monetary policy at its meeting on October 30-31, as on Saturday the Governor Haruhiko Kuroda said that the BOJ would certainly reduce short-to-medium-term interest rated if needed, to ease monetary policy.
