TOKYO • Japanese exports and imports surged last month, with both beating expectations as a recovery in trade appeared to gain momentum. Exports rose by 18.1 per cent from a year earlier, the biggest rise since November 2013. Imports climbed by 15.2 per cent. The trade surplus was 113.6 billion yen (S$1.4 billion).
Car shipments to the United States increased by 28.3 per cent, though part of the increase can be attributed to lower exports the previous year, according to the Ministry of Finance.
Shipments of electronic parts to Asia rose by 21.6 per cent.
Japan has enjoyed a run of strong growth in exports this year, while rising imports add to signs that domestic demand is firming as well. The Japanese economy grew at an annualised 2.5 per cent in the second quarter, more than double its potential growth rate. But while a weaker yen has improved trade data, inflation remains well below the Bank of Japan's 2 per cent target.
"In a word, the trade data is strong," said Dai-ichi Life Research Institute's chief economist Yoshiki Shinke. "Imports are strong, but exports were stronger, and this is definitely a positive reading."
GOING UP AND UP
Rise in exports from a year earlier.
Rise in imports.
Tokai Tokyo Research Centre's chief economist Hiroaki Muto said: "In the third quarter, we will see a trend reversal in the Japanese economy. External demand will be strong and consumption will lack momentum."