June 2022 Trade Statistics

◆According to June 2022 trade statistics, export value grew for the sixteenth consecutive month at +19.4% y/y. As easing up of supply constraints progressed, the effects of a boost in export volume appeared due to the benefits of the weak yen, bringing progress in export recovery. On the other hand, import value rose significantly at +46.1% y/y. As a result, the trade balance was in the red for the eleventh consecutive month at -1,383.8 bil yen. The Apr-Jun period trade deficit (in seasonally adjusted terms) recorded a historic high at -5,377.7 bil yen. In response to this development, the contribution of overseas demand to Apr-Jun period real GDP is expected to move a small amount into the negative range.

◆Export volume in June (seasonally adjusted by DIR) grew for the second consecutive month at +2.0% m/m. The recovery of motor vehicle exports backed by the easing up of difficulty in procuring parts provided a major boost to overall performance. Export volume to the US and the EU shifted into growth, with the US up by +0.6%, and the EU up by +5.9%, while export volume to Asia suffered a decline at -1.0% as a result of reactionary decline after the previous month’s major growth. Export volume to China achieved major growth at +10.5%.

◆Export volume is expected to move toward moderate growth in the future. The normalization of China’s economy is expected to bring progress in mitigation of the difficulty of procuring parts, and motor vehicle exports will likely continue to get back on track. Meanwhile, the recent resurgence of COVID-19 in Japan is expected to be unlikely to cause the kind of bottleneck that occurred at the beginning of the year, with less of a decrease in the number of employees commuting to the office. On the other hand, the sense of uncertainty regarding the future of overseas demand, especially in the US and Europe, requires continued awareness of risk factors.