Newspulse

Japanese exports rose in June for the seventh consecutive month, but growth slowed to its lowest pace since late last year, raising concerns about the impact of a slowdown in China on Japan’s trade-reliant economy. The latest data suggests that weakening exports could undermine hopes that robust external demand might offset weak domestic consumption.

According to the Ministry of Finance, Japanese exports increased by 5.4% year-on-year in June, below the 6.4% rise anticipated by economists and down from a 13.5% growth rate in May. This deceleration in export growth reflects the challenges faced by Japan as it attempts to recover from a sharper-than-expected economic contraction in the first quarter.

The weak yen, which has hit 38-year lows, boosted the value of exports, but export volumes fell by 6.2% in June. Takeshi Minami, chief economist at Norinchukin Research Institute, noted that despite the weak yen, the United States, Europe, and China are not expected to grow strong enough to significantly support Japan’s exports, pointing to the lack of a robust global export growth engine.

By destination, exports to China rose by 7.2% year-on-year in June, driven by demand for chip-making equipment. However, this was a slowdown from the 17.8% increase recorded in May. Exports to the United States, a crucial market for Japan, grew by 11% year-on-year, while exports to the European Union fell by 13.4%.

On the import side, the value of imports grew by 3.2% in June compared to the previous year, which was less than the 9.3% increase expected by economists. This led to a trade surplus of 224 billion yen, the first in three months, contrasting with expectations of a 240 billion yen deficit. In May, imports had risen by 9.5%.