| Consensus | Consensus Range | Actual | Previous | Revised | |
|---|---|---|---|---|---|
| Balance | ¥-670.0B | ¥-825.0B to ¥-453.7B | ¥-432.4B | ¥-754.5B | ¥-755.1B |
| Imports - Y/Y | -0.5% | -1.2% to 1.1% | -2.3% | 7.3% | |
| Exports - Y/Y | 3.0% | -0.9% to 4.0% | 2.6% | 4.3% |
Highlights
The year-over-year increase in Japanese export values slowed further in April amid softer global demand despite solid shipments of automobiles on improving supply chains, data released Thursday by the Ministry of Finance showed.
Import values posted their first drop in 27 months as energy and commodities prices have eased after last year's spike, leading to a narrower trade deficit for a third straight month after hitting a record shortfall in January, a month when trade flows tend to be irregular around the lunar new year holidays in some parts of Asia.
Shipments to China, the key export market for Japanese goods, posted their fifth straight year-over-year decline in April, led by declines in autos and auto parts as well as iron and steel, as seen in the previous month. The world's second-largest economy is gradually recovering from the sluggish activity caused by Beijing's strict zero-Covid policy.
The Econoday Consensus Divergence Index stood at plus 26, above zero, which indicates the Japanese economy is performing better than expected. Excluding the impact of inflation, the index was at plus 33.
Export values rose 2.6 percent on the year in April for the 26th straight rise, with the pace of increase decelerating from 4.3 percent in March, 6.5 percent in February and 3.5 percent in January and following double-digit percentage gains in the prior months. It was lower than the median forecast of a 3.0 percent rise (forecasts ranged from a 0.9 percent drop percent to 4.0 percent rise).
Amid slowing global economic growth, export volumes fell 6.2 percent on the year for the seventh straight drop after falling 8.1 percent in March.
The increase in April export values was led by the recent pickup in automobile shipments, thanks to easing global supply constraints, in addition to higher demand for optical equipment and ships. Exports of plastics, semiconductor-producing equipment and mineral fuels dropped.
Import values fell 2.3 percent on the year in April for their first drop in 27 months, coming in weaker than the median forecast of a 0.5 percent decline. It followed increases of 7.3 percent in March, 8.5 percent in February and 17.6 percent in January. The decrease was led by crude oil, liquefied natural gas and non-ferrous metals, as the prices for energy and commodities have eased.
Import volumes fell 0.4 percent on year in April for the sixth straight decrease after dipping 2.6 percent in March.
The trade balance came to a deficit of ¥432.4 billion in April. It marked the 21st straight month of a shortfall, narrowing further from a revised deficit of ¥755.1 billion, ¥919.9 billion in February and a record high deficit of ¥3,506.4 billion in January, and compared to a deficit of ¥854.9 billion in April 2022. The gap was much narrower than the consensus forecast of a ¥670.0 billion deficit.
Import values posted their first drop in 27 months as energy and commodities prices have eased after last year's spike, leading to a narrower trade deficit for a third straight month after hitting a record shortfall in January, a month when trade flows tend to be irregular around the lunar new year holidays in some parts of Asia.
Shipments to China, the key export market for Japanese goods, posted their fifth straight year-over-year decline in April, led by declines in autos and auto parts as well as iron and steel, as seen in the previous month. The world's second-largest economy is gradually recovering from the sluggish activity caused by Beijing's strict zero-Covid policy.
The Econoday Consensus Divergence Index stood at plus 26, above zero, which indicates the Japanese economy is performing better than expected. Excluding the impact of inflation, the index was at plus 33.
Export values rose 2.6 percent on the year in April for the 26th straight rise, with the pace of increase decelerating from 4.3 percent in March, 6.5 percent in February and 3.5 percent in January and following double-digit percentage gains in the prior months. It was lower than the median forecast of a 3.0 percent rise (forecasts ranged from a 0.9 percent drop percent to 4.0 percent rise).
Amid slowing global economic growth, export volumes fell 6.2 percent on the year for the seventh straight drop after falling 8.1 percent in March.
The increase in April export values was led by the recent pickup in automobile shipments, thanks to easing global supply constraints, in addition to higher demand for optical equipment and ships. Exports of plastics, semiconductor-producing equipment and mineral fuels dropped.
Import values fell 2.3 percent on the year in April for their first drop in 27 months, coming in weaker than the median forecast of a 0.5 percent decline. It followed increases of 7.3 percent in March, 8.5 percent in February and 17.6 percent in January. The decrease was led by crude oil, liquefied natural gas and non-ferrous metals, as the prices for energy and commodities have eased.
Import volumes fell 0.4 percent on year in April for the sixth straight decrease after dipping 2.6 percent in March.
The trade balance came to a deficit of ¥432.4 billion in April. It marked the 21st straight month of a shortfall, narrowing further from a revised deficit of ¥755.1 billion, ¥919.9 billion in February and a record high deficit of ¥3,506.4 billion in January, and compared to a deficit of ¥854.9 billion in April 2022. The gap was much narrower than the consensus forecast of a ¥670.0 billion deficit.
Market Consensus Before Announcement
The year-over-year increase in Japanese export values is forecast to have slowed further to 3.0 percent in April from 4.3 percent in March and 6.5 percent in February amid softer global demand despite solid shipments of automobiles on improving supply chains. Import values are seen posting their first drop in 27 months as energy and commodities prices have eased, leading to a narrower trade deficit for a third straight month at ¥670.0 billion versus March's revised ¥755.1 billion.
Definition
Merchandise Trade balance measures the difference between imports and exports of both tangible goods and services. The level of the international trade balance, as well as changes in exports and imports, indicate trends in foreign trade.
Description
Japan's merchandise trade balance measures visible trade and excludes services. Specifically it is the difference between imports of goods and exports of goods. A positive value indicates a trade surplus (exports exceed imports) while a negative value indicates a trade deficit (imports exceed exports). Movements in the trade balance reflect altered demand for Japanese exports which subsequently impact the yen's value and directly affect GDP growth because of the economy's dependence on trade.
The report gives insight into changing trends regarding Japanese trade. Such developments are especially important for Japan, which is an export-oriented economy that has historically experienced large trade surpluses and any change can have a dramatic effect on the domestic economy. Typically the headline number is the change from the previous year in yen along with the percentage change in exports and in imports from the previous year.
The report gives insight into changing trends regarding Japanese trade. Such developments are especially important for Japan, which is an export-oriented economy that has historically experienced large trade surpluses and any change can have a dramatic effect on the domestic economy. Typically the headline number is the change from the previous year in yen along with the percentage change in exports and in imports from the previous year.
