Japan’s Best Export Performance Since 2008 Crisis Rolls On

Updated on
  • Value of exports in October rose 14% from a year earlier
  • Export volumes remain below pre-crisis levels despite recovery
Takuji Okubo, chief economist at Japan Macro Advisors, discusses Japan’s October trade balance figures.

Japan’s exports grew by double digits for a fourth straight month in October, continuing the best year-to-date performance since the global financial crisis. 

  • The value of exports rose 14 percent from a year earlier (forecast +15.7 percent).
  • Imports increase 18.9 percent (forecast +20.2%).
  • The trade surplus was 285.4 billion yen ($2.6 billion), less than the forecast of 330 billion yen.

Improving global demand has fueled strong growth in Japan’s exports throughout the year, with new smartphones creating demand for parts and machinery in recent months. In the 10 months through October, Japan exported 64 trillion yen worth of goods, the most over that period in any year since 2008. This has helped drive Japan’s economy to seven straight quarterly expansions, while investors expecting growing earnings have pushed stock prices to multi-year highs.

Economists’ Views

  • "Japan’s exports are on an increasing trend thanks to a solid global recovery," said Norio Miyagawa, senior economist at Mizuho Securities. "I think semiconductors related to the production of the new iPhone are one of key drivers."
  • "We can count on exports as the engine driving Japan’s economy in coming quarters," Miyagawa said, forecasting growth of 1 percent to 1.5 percent in the three months through December.
  • "I do get the impression that the pace of growth in exports slowed down a little last month, but there’s still a steady underlying expansion," said Atsushi Takeda, an economist at Itochu Corp. in Tokyo.
  • "Overall semiconductors and autos lead exports, and for the moment it looks like we don’t need to be too worried about those sectors," Takeda said.

Other Details

  • Japan’s adjusted trade balance showed a surplus of 322.9 billion yen (forecast 206.7 billion yen).
  • Exports to China, Japan’s largest trading partner, rose 26 percent from a year earlier.
  • Those to the U.S. rose 7.1 percent.
  • Shipments to the EU climbed 15.8 percent.
  • The volume of exports grew 3.8 percent from last October.

While the value of exports has recovered to the levels of a decade ago, volumes are below those highs.

— With assistance by Tomoko Sato, Toru Fujioka, Yuko Takeo, and Connor Cislo

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