The Bank of Japan will be pleased with continued export growth, though the trade deficit widened to a record on high commodity prices and a weak yen.
August export data continues to support the Bank of Japan's view that the impact of Shanghai’s lockdowns on automobile makers is waning but bank officials are worried about the impact of lingering semiconductor shortages on exports.
Officials also judged that the impact of a slowing U.S. economy on exports hasn’t been observed yet.
Japan's exports rose 22.1% y/y in August for an 18th straight rise following +19.0% in July, and imports rose 49.9% y/y for a 19th straight gain following +47.2% in July, data released on Thursday by the Ministry of Finance showed.
Japan posted a record high trade deficit of JPY2.817 trillion in the wake of high resource prices It was the 13th straight deficit following a deficit of JPY1.434 trillion in July.
Exports of automobiles rose 39.3% y/y in August vs. +13.7% in July, showing that the impact of the supply-side restrictions on automobile makers are easing.
Exports to China, Japan's largest trading partner, rose 13.5% in August for the third consecutive rise following +12.8% in July. Exports of automobiles surged 55.2% in August following +18.2% in July.
Exports to the U.S. rose 33.8% in August for the 11th straight rise following +13.9% in July. Exports of automobiles to the U.S. rose 34.6% vs. +8.4%.