Japan June exports seen tumbling again, CPI drop to keep deflation fears alive
Japan’s exports likely tumbled at a double-digit pace for the fourth month in a row in June, as the coronavirus epidemic took a heavy toll on global demand and the country’s export-led economy, a Reuters poll showed on Friday.
Global demand for cars and other durable goods has plunged since March as the pandemic prompted many countries to lockdown, forcing businesses to shut and people to stay at home.
Though more countries have started re-opening their economies and activity has likely bottomed out, policymakers and analysts play down the prospects for a sharp recovery in global demand.
Analysts polled by Reuters expect data on Monday will show Japan’s exports fell 24.9% in June from a year earlier, following a 28.3% fall in May, which was the biggest annual decline since September 2009.
Imports probably fell 16.8%, versus a 26.2% drop in the previous month, resulting in a trade deficit of 35.8 billion yen ($333.96 million), the poll of 16 economists showed.
A private factory survey for June had indicated new orders remained deep in contraction territory.
The Ministry of Finance will release the trade data at 8:50 a.m. on Monday (2350 GMT Sunday).
Weak demand is also keeping a lid on prices, stoking fears of a return to deflation, which is defined as a prolonged period of declines.
Other major data next week is expected to show the core consumer price index, excluding fresh food prices but including oil product costs, fell 0.1% year-on-year in June, but marginally less than a 0.2% decline in the previous month.