Japan exports fall 6.8% in six-month losing streak

TOKYO • Japan's exports fell for a sixth straight month in March in a sign that the yen's rise and sluggish emerging-market economies may be hurting foreign demand and holding back Japan's recovery.

Yesterday's data is among the key indicators this month that will show whether the economy contracted again in the first quarter after shrinking in the final quarter of 2015. If so, Japan's economy will again be experiencing the technical definition of a recession.

Weak indicators should add pressure on the government and the Bank of Japan to do more to stimulate growth, while a series of earthquakes that struck a southern manufacturing hub last week could hamper supply chain and economic activity ahead.

"A delayed recovery in the US economy, slowdown in China and sluggish demand for electronics parts on a cut in iPhone production were factors behind weak exports," said Mr Hidenobu Tokuda, senior economist at the Mizuho Research Institute.

"External demand is likely put a drag on the first-quarter GDP, which could show another economic contraction."

The Ministry of Finance said exports fell 6.8 per cent in the year to March, following the 4 per cent fall in February.

Exports to China - Japan's largest trading partner - fell 7.1 per cent in March, while US-bound shipments dropped 5.1 per cent year on year.

Exports to Asia, which account for more than half of Japan's shipments, fell 9.7 per cent.

The US dollar is down about 10 per cent so far this year, prompting warnings from Japanese policymakers against investors pushing up the yen too fast.

REUTERS

A version of this article appeared in the print edition of The Straits Times on April 21, 2016, with the headline 'Japan exports fall 6.8% in six-month losing streak'. Print Edition | Subscribe