May Trade Statistics

◆According to May 2014 trade statistics, exports in monetary terms were down -2.7% y/y, their first decline in fifteen months, and fell below market consensus as well (-1.3% y/y). Declines were due mainly to export volume having fallen in y/y terms for the first time in two months, at - 3.4%. In seasonally adjusted terms export amount also fell for the first time in 2 months, registering -1.2% in month-to-month terms.

◆The export volume index on a seasonally adjusted basis (DIR) fell for the first time in 2 months registering -2.1% m/m. By region, exports to the US were suffered a major decline of -4.7% m/m, thereby pushing overall figures down. Meanwhile, the EU gained +0.1% and Asia was up by +0.9%, continuing their recent growth, if only by a small margin.

◆In monetary terms, May imports fell y/y for the first time in nineteen months at -3.6%. The major decline suffered by import volume suffered at -4.0% y/y is thought to be the cause of the decline in import amount. Import volume fell in April due to a reaction decline after the increase in the consumption tax, and that situation seems to have remained unchanged in May. As a result, Japan’s trade balance was in the red by 909 bil yen, the second consecutive month of year-to-year declines in the trade deficit.