Japanese exports show a fall
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Japanese carmakers are shifting some production to U.S. plants.
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TOKYO, Japan (Reuters) -- Japanese exports fell in November, new data shows, but analysts expect the drop to be temporary.
They are taking heart from a better-than-expected reading Monday on a key measure of economic activity.
Data from the Ministry of Finance showed Japan's customs-cleared trade surplus rose 11.3 percent in November from a year earlier to 990.16 billion yen ($9.18 billion).
The surplus was up for the fifth straight month and was higher than a median forecast in a recent Reuters poll.
But exports, which have helped bring about a mild economic recovery in Japan despite sluggishness in areas such as retail spending, were down 2.0 percent from a year earlier, the first year-on-year decline in five months.
While exports were up 2.3 percent from a month earlier on a seasonally adjusted basis, the year-on-year figure caused some concern that the U.S. economic recovery had yet to translate into bigger flows from Japan to its largest trading partner.
The surplus with the United States was down 29.8 percent from a year earlier at 548.3 billion yen in the 11th straight month of decline.
"It seems the recovery in the U.S. economy has yet to be reflected in the export figures. But exports to Asia remain strong and both exports and imports should show robust growth going into next year," said Mamoru Yamazaki, chief economist at Barclays Capital.
The strong yen was probably a factor, but the ministry also noted that Japanese car makers had shifted production of some medium-sized vehicles to U.S. plants.
The ministry said that car exports to the United States were down 31.0 percent from a year earlier, contributing to a 21.1 percent drop in overall Japanese exports.
Overseas production of Japanese cars was expected to top 10 million units by 2005, overtaking domestic production, the Nihon Keizai Shimbun daily reported on Monday.
"I wouldn't read too much into November's figures if the cause was from a change in production sites. The recovery in the U.S. economy is picking up and Japanese exports should follow," said Yasuo Goto, an economist at Mitsubishi Research Institute.
A 5.2 percent year-on-year decline in imports, the first such drop in 15 months, may also prove temporary, with the ministry attributing a steep fall in crude oil imports to milder-than-usual winter weather.
Crude oil imports in November marked the steepest year-on-year drop since March 2002.
The Ministry of Economy, Trade and Industry (METI) said the all-industries index, which economists regard as a gauge of gross domestic product (GDP), rose 0.8 percent in October from the previous month, better than expected and more in line with other recent data showing strength in the economy.
The tertiary sector index, a core component of the all-industries index covering mainly service industries, rose 1.1 percent to a record high of 110.2, led by sectors including transport, communications and retail.
Last week, the government forecast that GDP would probably grow 1.8 percent in real terms in fiscal 2004-05 after a projected 2.0 percent expansion this year.
It said that private-sector consumption was likely to gather pace as growing corporate earnings filtered through to personal income.
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Reuters. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
