December 2016 Trade Statistics

Export value makes y/y gains for first time in 15 months

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January 25, 2017

  • Keisuke Okamoto
  • Shunsuke Kobayashi

Summary

◆According to December 2016 trade statistics, export value grew for the first time in 15 months at +5.4% y/y, while at the same time exceeding market consensus (+1.1%). In addition to export volume winning a higher percentage of growth than in the previous month, export price saw a major reduction in the extent of its decline. These factors helped to push up export value. Meanwhile, import value declined for the 24th consecutive month by -2.6% y/y, putting the trade balance into the black for the fourth consecutive month at +641.4 bil yen.


◆Export value in seasonally adjusted terms grew for the fifth consecutive month at +1.8% m/m, while export volume suffered a decline for the first time in four months at -0.7% (seasonal adjustment by DIR). Looking at export volume by source of demand, exports to the US declined for the first time in four months by -2.0%, while exports to the EU also declined for the first time in four months by -3.8%. Exports to Asia were up for the third consecutive month at +3.6%. As for export volume by product, export volume of ICs and audio devices to the US declined, while exports of passenger vehicles took a breather from the growth trend of recent months. Exports to Asia maintained favorable performance with export volume in the areas of passenger vehicles, buses and trucks, as well as ICs doing well.


◆As for the future of exports, our opinion remains unchanged from the previous report. We see moderate growth, which can be maintained due to the underlying strength of overseas economies. However, we advise caution as regards recent developments occurring immediately after President Trump’s inauguration, such as the decision to withdraw from TPP and renegotiate NAFTA, possibly even withdrawing from that agreement. If the US economy becomes overly protectionist, it could cause world trade to stagnate, turning into a long-term risk factor.

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