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Japan's trade surplus up 21pc in October, exports up 2pc

A WEAKER yen and healthy growth in China has helped push up Japan's export volumes, resulting in Japan's trade surplus increasing by a seasonally adjusted 21 per cent in October compared with the previous month.

October marked the 24th straight month of trade surplus and demonstrates how external demand has strengthened the economy after several rounds of monetary stimulus by the Bank of Japan weakened the yen, reported London's Financial Times.

Solid exports and robust demand from China suggest net trade will continue to support the economy in the fourth quarter and bolster the outlook for growth.

The figures indicate "its a clear recovery in exports to Asia", Barclays economists Yuichiro Nagai and Yukito Funakubo said in a note, with exports to China "continuing to show strong growth".

In October exports increased two per cent on a seasonally adjusted basis compared to the previous month, while imports were up 1.2 per cent. Compared with 2016, exports were up 14 per cent in value terms in yen, while imports rose 19 per cent, reflecting depreciation of the yen.

In volume terms, exports grew by 3.8 per cent compared to October 2016, while imports were up 3.2 per cent.

By destination, exports to China were up 26 per cent on a year ago, with Japan supplying much of the capital equipment to tool its manufacturing sector.

Exports of semiconductor equipment to China were up 123 per cent year on year to JPY67.6 billion (US$603 million); overall machinery exports increased 45 per cent; and vehicle exports were up 26 per cent.