In Japan, trade balance recorded deficit of JPY -0.97T (non seasonally adjusted) in May, first deficit in four months. Exports dropped -7.8% yoy to JPY 5.84T, sixth consecutive month of decline. Imports dropped -1.5% to JPY 6.80T, first decline in three months. Sluggish exports are generally seen as the results of on-going, escalating US-China trade war, which remains a negative factor for the Japanese economy.
Looking at some details (non seasonally adjusted):
- Exports to China dropped -9.7% yoy.
- Imports from China dropped -0.9% yoy.
- Exports to EU dropped -7.1% yoy.
- Imports from EU rose 8.7% yoy.
- Exports to US rose 3.3% yoy.
- Imports from US dropped -1.6% yoy.
Separately, Masatsugu Asakawa, Japan’s vice finance minister for international affairs, said more substantial talks on trade policy will be held in the G20 summit in Osaka next week. But he also noted that “Japan won’t take sides on US-China trade friction, our stance is to not take steps that violate WTO rules.”