Japanese exports in June grew for the seventh consecutive month, but the growth rate slowed to its lowest level since the end of last year, data on Thursday showed. This highlights concerns that China's economic slowdown could impact Japan's trade-reliant economy.
The slowdown in exports may dampen policymakers' hopes that strong external demand could offset the impact of weak domestic consumption. Japan's economy is expected to recover from a surprisingly sharp contraction in the first quarter.
Data from Japan's Ministry of Finance (MOF) showed that exports in June increased by 5.4% year-on-year, below the 6.4% expected by economists in a Reuters poll, and down from 13.5% growth in May.
Despite the weak yen falling to its lowest level in 38 years, boosting the value of exports, export volumes in June fell by 6.2%.
"Apart from the boost from the yen's depreciation, we can't expect strong enough growth from the U.S., Europe, or China to support Japan's exports," said Takeshi Minami, chief economist at Norinchukin Research Institute. "There is no global engine for export growth."
By destination, the value of exports to China grew by 7.2% year-on-year in June, mainly driven by demand for chip-making equipment, but the growth rate slowed from 17.8% in May.
Shipments to Japan's ally and major market, the United States, increased by 11% year-on-year, while exports to the European Union fell by 13.4%.
