Japanese exports to U.S. down 14% in Aug., fall for 5th month on tariffs
Japan's exports to the United States in August dropped 13.8 percent from a year earlier to 1.39 trillion yen ($9.5 billion), falling for the fifth straight month, as auto shipments plunged amid higher tariffs, government data showed Wednesday, Kyodo reports.
The trade surplus with the United States shrank 50.5 percent to 324 billion yen, weighed down by a 28.4 percent plunge in auto exports, while imports grew 11.6 percent to 1.06 trillion yen, the Finance Ministry said in a preliminary report.
U.S. President Donald Trump raised vehicle duties by 25 percentage points to 27.5 percent in April as part of his aggressive tariff policy. Tokyo and Washington agreed in July to cut the rate to 15 percent, with the reduction taking effect Tuesday.
The size of the decline in exports to the United States widened from a 10.1 percent drop in July, with Japan's vehicle shipments to the world's largest economy sliding 9.5 percent in volume in August.
Among other shipments to the United States, construction machinery shed 26.1 percent and semiconductor manufacturing equipment plunged 38.9 percent.
"Price hikes (to cover tariff costs) may start gradually affecting automakers' sales," said Takeshi Minami, chief economist at the Norinchukin Research Institute.
"Even with a 15 percent tariff, corporate earnings will deteriorate and the Japanese economy will be pressured if it hinders wage hikes and other positive developments," Minami said.
Globally, Japan recorded red ink in August for the second consecutive month, but its trade deficit shrank 65.9 percent to 242.5 billion yen as imports declined due to lower crude oil prices and reduced shipments from the Middle East.
Overall exports edged down 0.1 percent to 8.43 trillion yen, marking the fourth straight month of decline, while imports decreased 5.2 percent to 8.67 trillion yen, down for the second consecutive month.
By region, Japan remained in the red with China for the 53rd consecutive month, logging a deficit of 425.7 billion yen, a rise of 12.4 percent on year.
China-bound exports edged down 0.5 percent to 1.5 trillion yen while imports from the country grew 2.1 percent to 1.93 trillion yen.
Japan's trade surplus with the rest of Asia, including China, rose 25.3 percent to 545.5 billion yen.
Its trade deficit with the European Union stood at 121 billion yen, remaining in the red for the 19th straight month.
As written before, Trump lowered 15% tariff on cars from Japan to take effect Tuesday.
