TOKYO • Japan's exports surged last month by the fastest in more than two years on bigger shipments of cars and steel - an encouraging sign that robust overseas demand will support economic growth.
The 14.9 per cent annual increase in exports last month was below the median estimate for a 16.1 per cent annual increase, but it was nonetheless the biggest rise since January 2015.
Exports are likely to continue rising at a steady pace as overseas economies show increasing signs of strength, which should help Japan's economy extend its recent run of solid expansion.
Japan's exports to the United States rose by 11.6 per cent last month from a year ago, the fastest increase since July 2015, due to a rise in shipments of cars and auto parts.
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Exports to China increased by 23.9 per cent year on year last month, following a 14.8 per cent annual increase in April.
Larger shipments of flat panels and semiconductor manufacturing equipment drove the gains in China-bound exports.
Japan's imports rose by 17.8 per cent in the year to May, versus the median estimate for a 14.8 per cent annual increase, as a rise in the price of oil from a year ago pushed up the value of imports.
The trade balance came to a deficit of 203.4 billion yen (S$2.53 billion), versus the median estimate for a 76 billion yen deficit.
Policymakers and economists have become more optimistic about Japan's prospects this year as an increase in factory output and a tightening labour market show that the economy is poised to extend its recent growth.