By Makiko Yamazaki
TOKYO- Japan’s exports rose faster than expected in November, data showed on Wednesday, helped by a weaker yen and solid global demand although businesses worry protectionist US trade policies will undermine future growth.
Total exports rose 3.8 percent year-on-year in November, more than a median market forecast for a 2.8 percent increase and following a 3.1 percent rise in October.
Strong chipmaking equipment exports to Taiwan and China, coupled with a weaker yen, boosted the overall value.
But volumes dipped 0.1 percent, suggesting growth in value largely reflected the boost from the yen’s weakness.
“The results are not as great as they look,” said Koki Akimoto, an economist at the Daiwa Institute of Research.
Looking ahead, exports are likely to stay flat, as strong demand for chipmaking equipment is offset by a moderate US slowdown as well as risks from President-elect Donald Trump’s trade policies, he said.
Exports to China, Japan’s biggest trading partner, rose 4.1 percent in November from a year earlier, while those to the United States were down 8 percent due to a drop in automobile exports, the data showed.
Imports dropped 3.8 percent in November from a year earlier, compared with market forecasts for a 1 percent increase.
As a result, Japan ran a trade deficit of 117.6 billion yen ($766.17 million) in November, smaller than the forecast deficit of 688.9 billion yen.
The outlook for exports is increasingly uncertain.
Nearly three-quarters of Japanese companies expect Trump’s next term as US president to have a negative impact on their business environment, a Reuters survey showed.
Trump has threatened tariffs in excess of 60 percent on US imports of Chinese goods, as well as levies of 25 percent on goods from Canada and Mexico, where several Japanese automakers have factories.
While uneven overseas demand ahead may undercut Japan’s export engine, the Bank of Japan expects a consumption-led recovery to allow the bank to gradually raise interest rates from near-zero levels.
The BOJ announces its policy decision on Thursday. Sources have told Reuters the central bank is leaning toward keeping rates steady this week as policymakers prefer to spend more time scrutinizing overseas risks. —Reuters
