January Trade Statistics

Export volume bottoms out; trade balance surplus takes hold

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February 18, 2016

  • Shunsuke Kobayashi

Summary

◆According to January 2016 trade statistics, export value fell for the fourth consecutive month by -12.9% y/y. Export volume also suffered (-9.1%), with the extent of y/y decline exceeding that of the previous month. Meanwhile, on a seasonally adjusted basis, trade volume is seen as having bottomed out. Hence these results should not be negatively assessed. As for performance in terms of types of goods, household consumer related demand has been favorable, supported by financial environments influenced by monetary easing in all regions. On the other hand, low operating rates continuing worldwide and prices of natural resources continuing to fall, exports of materials and capital goods, which depend on the corporate sector, were unfavorable, confirming the structural changes going on in world economies.


◆The trade balance was in the red for the first time in two months at -645.9 bil yen. However, in seasonally adjusted terms, the trade balance has actually improved due to the decline in import prices mostly in the area of petroleum products, and is shown to be in its third consecutive month of surplus.


◆As for the future of exports, we see a gradual recovery continuing with ups and downs along the way. The US economy continues to maintain a firm undertone focusing on the household sector, and promises to bring a continued growth trend in exports of durable goods. As for exports to the EU, the collapse in the price of crude oil and the effects of quantitative easing initiated by the ECB are encouraging a comeback. When all is averaged out, the EU is expected to continue recovering. Meanwhile in Asia, China’s real economy is beginning to show signs of pulling out of the doldrums due to the lowering of its reserve deposit rate and interest rate, and further declines in demand centering on consumer goods will most likely be avoided.

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