Japan exports fell more than expected in September
Summary
Japan’s exports dropped for the first time in 10 months in September, with weak shipments to its major trading partners casting some doubt over the nation’s economic recovery path.
TOKYO—Japan’s exports dropped for the first time in 10 months in September, with weak shipments to its major trading partners casting some doubt over the nation’s economic recovery path.
Exports fell 1.7% in September from a year earlier, dropping for the first time since November 2023, Ministry of Finance data showed Thursday.
The reading compared with a 5.5% increase in August and the 0.85% fall forecast by economists polled by data provider FactSet.
By regions, Japan’s exports to China slid 7.3% due to falls in shipments of cars and car parts. It was the first decline in 10 months.
Exports to the U.S. dropped 2.4%, reflecting lower shipments of cars and machinery for construction and mining.
The country posted a trade deficit of 294.3 billion yen, equivalent to $1.97 billion, in September, marking the third consecutive monthly shortfall.
Japan’s trade deficit shrank in September amid the yen’s recovery.
The currency’s strength reduces the cost of imports such as energy and food, but weighs on Japan’s exports by making its goods less competitive abroad.
The yen stood at an average of 144.27 against the dollar in September, appreciating 1.5% from a year ago, the data showed. The yen is trading around 149.55 on Thursday.
While the weaker-than-expected exports performance in September is concerning, ING economists think the softness is partly due to production disruptions caused by weather events like typhoons and earthquake warnings.
“We are cautious about interpreting today’s data as a sign of weakening external demand," they wrote in a note.
Taking together with other recent soft data, the trade print leads the ING economists to believe that the impact of the typhoon and earthquake warnings might have been larger than expected. They plan to trim third-quarter gross domestic product growth estimates but raise those for the fourth quarter, expecting a technical payback.
Write to Megumi Fujikawa at megumi.fujikawa@wsj.com
