JPY: Real Exports Expected to Rise Slightly - Nomura
Research Team at Nomura, suggests that Japanese real exports are
expected to rise slightly in March while they are anticipating weakness
in both exports and imports in Jan-Mar.
“We have estimated March 2016 imports and exports, data for which are scheduled for release on 20 April (Wednesday), using the trade statistics for 1-20 March released by the Ministry of Finance (MOF) on 8 April and the corporate goods price index announced by the Bank of Japan (BOJ) on 13 April.
Nominal exports down 7.1% y-y in first 20 days of March: Nominal exports in the first 20 days of March were down 7.1% y-y (versus -2.8% in the first 20 days of February), while nominal imports fell 20.8% (-18.7%). According to a Nikkei QUICK News report on 8 April, exports declined for steel, organic compounds, and metal processing machinery, while imports declined for petroleum, LNG, and oil products.
We expect widening trade surplus (seasonally adjusted): There was one fewer business day in the first 20 days of March 2016 than in the first 20 days of March 2015, but one more business day in the remainder of the month. For March as a whole, we estimate that nominal exports will be down 6.9% y-y and nominal imports down 20.3%. We forecast a trade surplus (seasonally adjusted) of ¥660.8bn, up from ¥166.1bn in February.
Expecting real exports to rise slightly in March but weak q-q number for Jan-Mar: Adjusting our March nominal import/export estimates to reflect corporate goods price index data for March (export prices -9.1% y-y, import prices -20.2%) and seasonality results in seasonally adjusted estimates of +0.3% m-m for real exports and -8.1% for real imports.
On a quarterly basis, we estimate real exports in Jan-Mar 2016 will be up 0.2% q-q (+1.3 in Oct-Dec 2015) and that real imports will be down 1.2% q-q (-0.6% q-q). We thus expect both exports and imports will be sluggish in Jan-Mar.”