Japan Oct exports seen snapping double-digit growth as car shipments falter – Businesshala poll

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TOKYO (Businesshala) – Japan’s export growth likely slowed in October, breaking a seven-month double-digit extension due to declining car shipments, a Businesshala poll showed on Friday.

FILE PHOTO: Subaru cars await export from Yokohama, Japan, May 30, 2017. Businesshala/Toru Hanai

The data is expected to highlight the risks of an export-dependent economy that sees prolonged supply shortages, rising raw material prices and higher import costs from a weaker yen dent corporate profits.

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According to analysts polled by Businesshala, trade data will likely show exports rising 9.9% in October from a year earlier, rising for the eighth straight month, but slowing from 13.0% growth in September.

Kenta Maruyama, economist at Mitsubishi UFJ Research and Consulting, said: “The apparent weakness in exports … reflects a sharp decrease in car shipments due to production cuts, due to shortages of semiconductors and other parts, with exports recovering until early 2022. Will be done.” The carmaker’s production constraints are eased.

Imports rose 31.9% in October from a year earlier after rising 38.6% in the previous month, resulting in a trade deficit for the third consecutive month, the survey showed.

The Finance Ministry will announce trade data on November 17 (2350 GMT, November 16) at 8:50 am.

Japan’s core consumer prices rose 0.1% in October from a year earlier, with the survey showing a similar pace of increase from September.

This would be in contrast to wholesale inflation, which hit a 40-year high of 8.0% in October as commodity prices soared, in a sign that companies are still struggling to pass on higher costs to consumers.

Consumer price data is due on Nov 19 (2330GMT, Nov 18) at 8:30 AM.

“Unlike Europe and the United States, demand is not accelerating, and the pace of consumption recovery remains modest,” said Takeshi Minami, chief economist at the Norinchukin Research Institute.

The survey also showed core machinery orders, a leading indicator of capital spending, are likely to grow by 1.8% month-on-month in September after falling 2.4% in August. The data is due on November 17th (2350GMT, November 16th) at 8:50am.

($1 = 114.2500 yen)

Reporting by Kantaro Komiya; Editing by Sam Holmes

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