— Japan Posts 17th Straight Trade Surplus
— But Export Growth Slows Y/Y For 6th Month In A Row
— Japan Aug Exports +15.8% Y/Y, Up 9 Months In Row
— Japan Aug Imports +17.9% Y/Y, Up 8 Months In Row
— Japan Aug Exports To US +8.8% Y/Y, Up 8 Months In Row
— Japan Aug Exports To EU +13.7% Y/Y, Up 9 Months In Row
— Japan Aug Exports To Asia +18.6% Y/Y, Up 10 Months In Row
— Japan Aug Exports To China +18.5% Y/Y, Up 10 Months In Row

TOKYO (MNI) – Japan’s trade surplus unexpectedly shrank by 37.5% in
August from a year earlier to Y103.22 billion, the first year-on-year
drop in 15 months, with the pace of export growth decelerating for the
sixth month in a row, Ministry of Finance data released on Monday
showed.

Japan has posted a trade surplus for 17 months in a row, with the
country’s last deficit, of Y5.41 billion, recorded in March 2009.

August’s surplus followed a downwardly revised surplus of Y801.99
billion in July (preliminary +Y804.20 billion), which was up 119.3% from
a year before. In August 2009, Japan posted a trade surplus of Y165.22
billion.

The August 2010 figure came in well far below the consensus call
for a surplus of Y236.40 billion.

The latest data showed that Japanese exports rose only 15.8% in
August from a year earlier to Y5.22 trillion, but still posted the ninth
straight year-on-year gain.

The pace of export growth decelerated for the sixth month in a row
after +23.5% in July, having peaked at +45.3% in February.

Today’s data indicated that Japan’s export-driven economic recovery
may be moderating in the wake of a slowdown in Europe, the U.S. and
China.

In August, shipments of automobiles, iron and steel products as
well as metalworking machinery posted double-digit percentage growth
from a year earlier but the pace of y/y growth in automobile and
semiconductor exports slowed from July.

Last year, demand for Japanese cars and electronics recovered
gradually in the aftermath of the global financial crisis and recession.

August imports rose 17.9% on the year to Y5.12 trillion, posting
the eighth consecutive y/y rise but slowing from +15.7% in July.

The value of imports of liquefied natural gas, iron ore and
non-ferrous metals continued rising sharply.

Exports to the United States rose only 8.8% from a year earlier to
Y776.1 billion, up for the eighth consecutive month. The export growth
pace slowed from +25.9% in July, showing a general downtrend from +50.5%
in February.

Shipments of automobiles now posted a y/y drop while mineral fuels,
power-generating machines and construction machinery led the increase in
U.S. exports.

Shipments to the European Union rose 13.7% to Y584.5 billion in
August, posting the ninth straight year-on-year gain. The pace of growth
accelerated from +13.3% in July.

Auto parts, construction machinery and ships led the increase in
exports to Europe.

Japan’s exports to Asia rose 18.6% to Y3.05 trillion in August,
marking the 10th consecutive month of y/y gains, with the pace slowing
for the seventh month from +23.8% in July and a recent peak of 68.3% in
January 2010.

Higher shipments of iron and steel products, metalworking machinery
and semiconductors led Japanese exports to Asia.

Exports to China, the largest market for Japanese goods, expanded
18.5% to Y1.05 trillion in August, showing the 10th consecutive y/y
rise.

Chinese export growth decelerated from +22.7% y/y in July and
+22.0% in June, on a general downtrend after hitting a recent peak of
+80.0% in January.

Shipments of metalworking machinery, semiconductors and automobiles
led the gain.

On a seasonally adjusted basis, Japan’s trade surplus posted a
surplus of Y589.65 billion in August, down 0.9% from the previous month.

Seasonally adjusted exports posted the fourth straight
month-on-month drop, down 2.3% in August, while imports fell 2.5%, the
showing the third straight m/m fall.

Japan’s unadjusted trade balance returned to a surplus of Y90.97
billion (still -94.3% y/y) in September 2008, but in the wake of the
collapse of U.S. investment bank Lehman Brothers it plunged into
negative territory again, posting deficits from October 2008 until
January 2009.

tokyo@marketnews.com
** Market News International Tokyo Newsroom: 81-3-5403-4833 **

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