(Bloomberg) — Japan’s exports gained at the slowest pace in eight months in October, adding to signs that global supply constraints are still weighing on the economy after it contracted by more than expected last quarter.
The value of Japan’s overseas shipments increased 9.4% from a year earlier, according to the Ministry of Finance on Wednesday. Economists had expected a gain of 10.3%.
The figures come just a couple of days before Prime Minister Fumio Kishida is expected to unveil a package of measures to get the economy back on track, including some steps to shore up Japan’s supplies of semiconductors.
What Bloomberg Economics Says…
“Looking ahead, we expect exports to drop in November, pressured by softer Chinese demand. Chip shortages also remain a downside risk for exports.”
— Asia Economist Team
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A weakening export trend places more importance on Kishida coming up with ways to help boost consumer spending in support of the economy rather than relying on external demand. The economy shrank an annualized 3% from July to September, with exports dropping 8.3% from the previous quarter.
The premier is looking to take steps to normalize activity in the economy now that about three quarters of the population is fully vaccinated.
Toyota Motor Corp. offered a glimmer of hope last week that global supply chains were recovering from the recent squeeze. After a series of output cuts, Japan’s biggest automaker said all of its domestic production lines will be operating normally in December for the first time in seven months, according to a statement by the company.
More details
- Imports gained 26.7% last month due partly to rising oil prices, according to the finance ministry.
- Japan had trade deficit of 67.4 billion yen ($590 million).
- Exports to U.S. gained only 0.4%, while the value of shipments to China rose 9.5%.
(Adds more details.)
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