Japan has joined China in reporting what can only be described as a rip snorting set of trade figures for 2017.
China’s figures for 2017 were pretty solid (even if the December data wasn’t up to the levels the market had dreamed up).
Now the region’s other powerhouse, Japan, is firing lifting its exports rose 12% in 2017 from 2016 and imports 14% as the global economy enjoyed its first synchronous rebound for more than five years.
And China is playing a major role in Japan’s improvement, along with South Korea and Taiwan.
By value, exports reached 7.3 trillion yen ($US66.27 billion) in December, the biggest amount since September 2008 when the last global financial crisis erupted.
A rebound in shipments to China as its economy gains momentum has been a boon for Japan’s manufacturers, while South Korean companies are taking more computer equipment such as semiconductors while steel exports to Taiwan were higher.
That was a more consistent performance from japan than from China where exports rose 7.9% in US dollar terms, while imports surged 15.9% (boosted by the rising cost of energy imports, such as Liquified Natural Gas).
The recovery in trade saw the Chinese economy steady and then grow a bit faster than expected by year’s end (6.9% year on year).
For Japan, the improvement in its trade performance drove stronger growth through the economy, though the trade surplus dropped 25% to 3 trillion yen ($US29 billion or $A34 billion).
The preliminary data released on Wednesday also showed exports climbing 9% in December from a year earlier while imports surged 15% (as the cost of energy – LNG, coal and oil rose).
As well, preliminary results from the Nikkei monthly survey of purchasing managers showed surging new orders helped push factory activity in January to its fastest pace in nearly four years.
Wednesday’s trade data comes after the Bank of Japan on Tuesday offered a more upbeat view of inflationary expectations on Tuesday, showing it remains confident the stronger economy will help drag inflation to its 2% target – at last (and more than four years behind original forecasts.
Exports to China, Japan’s biggest trading partner, rose 15.8% year-on-year in December led by semiconductor production equipment and electronics parts, hitting a record 1.5 trillion yen.
Shipments to Asia as a whole, which account for more than half of Japan’s exports, grew 9.9% in the year to December, led by China-bound semiconductor manufacturing equipment and mobile phone parts and steel shipments to Taiwan, reaching a record 4.1 trillion yen in value.
Exports to the US, Japan’s largest export market, rose 6.8% in 2017.
