| Consensus | Consensus Range | Actual | Previous | Revised | |
|---|---|---|---|---|---|
| Balance | ¥145.85B | ¥-80.60B to ¥326.10B | ¥-117.55B | ¥153.1B | ¥152.12B |
| Imports - Y/Y | -10.0% | -11.1% to -7.3% | -7.6% | 0.2% | 0.3% |
| Exports - Y/Y | -2.0% | -3.5% to -1.0% | -2.6% | -0.5% |
Highlights
Key points from Japan trade data:
--Japanese export values -2.6%, the third straight y/y drop in July -0.5% in June and -1.7% (the first decline in eight months) in May. Japanese carmakers are reducing the prices for U.S. customers to cover high Trump import tariff costs, exerting downward pressures on overall export prices, but the volumes of Japan's exports to the world remain on an uptrend. The decline in July export values was led by autos, iron/steel and auto parts.
--Import values -7.5% after marking an unexpected rise in June (+0.3%) and slumping 7.6% in May. The decrease was driven by lower prices for crude oil, coal and liquefied natural gas.
--The trade balance: a deficit of ¥117.55 billion vs. a downwardly revised ¥152.12 billion surplus in June (the first black ink in three months) and a ¥628.34 billion deficit recorded in July 2024.
--Exports to the United States -10.1% y/y, the 4th straight drop (-11.4% the previous month), hit by autos, auto parts and semiconductor-producing equipment; Exports to the European Union -3.4%, the first drop in three months (+3,6%), pushed down by iron/steel, organic compounds and auto parts; Exports to China -3.5% y/y, the 5th straight drop (-4.7%) on slower demand for autos, non-ferrous metals and auto parts.
--Japanese export values -2.6%, the third straight y/y drop in July -0.5% in June and -1.7% (the first decline in eight months) in May. Japanese carmakers are reducing the prices for U.S. customers to cover high Trump import tariff costs, exerting downward pressures on overall export prices, but the volumes of Japan's exports to the world remain on an uptrend. The decline in July export values was led by autos, iron/steel and auto parts.
--Import values -7.5% after marking an unexpected rise in June (+0.3%) and slumping 7.6% in May. The decrease was driven by lower prices for crude oil, coal and liquefied natural gas.
--The trade balance: a deficit of ¥117.55 billion vs. a downwardly revised ¥152.12 billion surplus in June (the first black ink in three months) and a ¥628.34 billion deficit recorded in July 2024.
--Exports to the United States -10.1% y/y, the 4th straight drop (-11.4% the previous month), hit by autos, auto parts and semiconductor-producing equipment; Exports to the European Union -3.4%, the first drop in three months (+3,6%), pushed down by iron/steel, organic compounds and auto parts; Exports to China -3.5% y/y, the 5th straight drop (-4.7%) on slower demand for autos, non-ferrous metals and auto parts.
Market Consensus Before Announcement
Key forecast points:
--Japanese export values -2.0%, the third straight y/y drop in July -0.5% in June and -1.7% (the first decline in eight months) in May. Japanese carmakers are reducing the prices for U.S. customers to cover high Trump import tariff costs and thus to protect their market share, exerting downward pressures on overall export prices, but the volumes of Japan’s exports to the world have been on an uptrend. The decline in July export values is expected to be led by autos, iron and steel and auto parts.
--Import values -10.0% after marking an unexpected rise in June (+0.2%) and slumping 7.7% in May. The decrease is seen driven by continued declines in prices for crude oil and coal as well as in payback to recent higher drug purchases.
--The trade balance: a surplus of ¥145.85 billion vs. a downwardly revised ¥152.12 billion surplus in June (the first black ink in three months) and a ¥628.34 billion deficit recorded in July 2024.
--Japanese export values -2.0%, the third straight y/y drop in July -0.5% in June and -1.7% (the first decline in eight months) in May. Japanese carmakers are reducing the prices for U.S. customers to cover high Trump import tariff costs and thus to protect their market share, exerting downward pressures on overall export prices, but the volumes of Japan’s exports to the world have been on an uptrend. The decline in July export values is expected to be led by autos, iron and steel and auto parts.
--Import values -10.0% after marking an unexpected rise in June (+0.2%) and slumping 7.7% in May. The decrease is seen driven by continued declines in prices for crude oil and coal as well as in payback to recent higher drug purchases.
--The trade balance: a surplus of ¥145.85 billion vs. a downwardly revised ¥152.12 billion surplus in June (the first black ink in three months) and a ¥628.34 billion deficit recorded in July 2024.
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.
