The result compared with an 11.9 percent increase expected by economists in a Reuters poll. It followed a 12.8 percent year-on-year rise in December, which was the fastest growth in a year. File pic shows a container ship is loaded at a port in Tokyo December 17, 2014. - REUTERS
TOKYO: Japan's exports fell for a sixth straight month in March as slowing growth in China, soft demand for electronic components for products such as the iPhone and a strengthening yen threatened to hold back the country's economic recovery.
Japanese electronics makers are unlikely to get much solace when Apple Inc reports its March quarter earnings next week. Analysts expect Apple to post its biggest-ever quarterly decline in iPhone shipments and present a weak sales forecast for the current quarter.
?A delayed recovery in the US economy, slowdown in China, and sluggish demand for electronics parts on a cut in iPhone production were factors behind weak exports," said Hidenobu Tokuda, senior economist at Mizuho Research Institute.
The trade news came hard on the heels of a Reuters poll suggesting that although confidence at Japanese manufacturers rose in April it was expected to worsen again in the coming three months, reflecting worries over the strong yen and tepid overseas demand.
Weak indicators should add pressure on the government and the Bank of Japan (BoJ) to do more to stimulate growth, while a series of earthquakes that struck a southern manufacturing hub in the past week could hamper supply chain and economic activity ahead.
Analysts say the quakes could cause a sharp drop in the country's factory output of cars and other goods in April - an unwelcome development for a flagging economy - although the impact may be short-lived if the supply chain is repaired quickly.
The finance ministry said exports fell 6.8% in the year to March, versus a 6.9% drop expected by economists, and followed a 4% fall in February.
Exports to China - Japan's largest trading partner - fell 7.1% in March, while the US-bound shipments also dropped 5.1% year-on-year.
Exports to Asia, which accounts for more than half of Japan's shipments, fell 9.7%. But exports to the European Union grew 12.1% in March, the biggest year-on-year gain since February 2011, driven by exports of ships to Italy and Greece, which grew five-fold from a year earlier, although that development is seen by the finance ministry as a temporary blip.
In the Reuters Tankan taken on April 1-15, exporters of cars and electronics complained about the rapid yen rise, which could dim Japan's recovery prospects and delay its recovery from two decades of deflation and stagnation.
The dollar so far this year is down about 10% on expectations that the United States would go slow in raising interest rates, prompting verbal warnings from Japanese policymakers against investors pushing up the yen too fast. - Reuters
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