Japan's Export Growth Cools in November


Japan's export growth cooled in November as the U.S. housing recession cut demand for automobiles and construction equipment.

Exports rose 9.7 percent from a year earlier, the Finance Ministry said in Tokyo today, after growth doubled in the previous month. The median estimate of 19 economists surveyed by Bloomberg News was for a 10.5 percent gain.

Shipments to the U.S. declined for a third month, the worst losing streak in more than three years. Japan's economy, the world's second-largest, is depending more on overseas markets just as world growth looks set to slow. Growth in shipments to Europe and China also slowed last month, today's report showed.

Imports rose 13.2 percent in November, the ministry said, after climbing 8.6 percent in the previous month, causing the trade surplus to fall 12.2 percent to 797.4 billion yen. Analysts expected an 11.8 percent increase. Exports, led by shipments to Europe and China, contributed almost all of Japan's 1.5 percent annualized growth in the third quarter.

Exports to the U.S. fell 6 percent, more than the 1.5 percent decline a month earlier, the ministry said. Shipments to China grew 13.7 percent, the slowest pace since February. Exports to the European Union rose 8.2 percent, the slowest rate since April 2006.

Half of Japan's shipments overseas are settled in U.S. dollars even though the country is relying more on China and other emerging markets for trade. The yen has surged 9 percent against the dollar in the past six months.

The currency is already hurting exporters' profits. Toyota Motor Corp.'s annual operating profit falls about 33 billion yen for every yen that the currency gains against the dollar past 115, according to Credit Suisse Group.

Not all exporters are suffering from slower demand overseas. Honda Motor Co., which sells about half of its autos in North America, said yesterday U.S. sales will increase 3 percent next year, thanks to higher demand for its fuel-efficient cars.


Bloomberg
12/20/2007 7:16:20 AM