Japan’s January exports grow more than expected

Workers walk in a container area at a port in Tokyo, Japan January 25, 2016. REUTERS/Toru Hanai/File photo

TOKYO  – Japan’s exports rose more than expected in January, driven by U.S.-bound shipments of cars and car parts and Chinese demand for chip-making equipment, helping ease some concerns about weakness in the broader economy.

Ministry of Finance data out on Wednesday showed Japan’s exports rose 11.9 percent in January from the same month a year ago, faster than a 9.5-percent gain expected by economists in a Reuters poll and 9.7 percent growth in the previous month.

The brisk exports could ease some concerns about further economic decline as the Reuters Tankan survey showed manufacturers’ business morale soured sharply, with pessimists outnumbering optimists for the first time in 10 months.

READ: Japan exports soared to record highs in December

The batch of indicators followed data last week that showed Japan unexpectedly tipping into recession in the fourth quarter and losing its spot as the world’s third-largest economy to Germany.

Negative interest rates policy

Speculation has grown since last year that the Bank of Japan may exit its negative interest rates policy as early as March or April, if wage and price growth picks up enough.

However, recent weak data has stoked worries Japanese firms may become reluctant to boost wages enough to achieve stable and sustainable inflation in a country that has been mired in a deflationary mindset for more than a decade.

The Reuters Tankan indexes found that manufacturers’ sentiment tumbled to minus 1 in February from the prior month’s plus 6, the first negative reading since last April. The index is seen rebounding to plus 6 in May.

READ: Japan slips into recession, Germany now world’s third-biggest economy

The trade data also showed imports fell 9.6 percent, versus the median estimate for a 8.4-percent decrease.

The trade balance came to a deficit of 1.758 trillion yen ($11.73 billion), versus the median estimate for a deficit of 1.926 trillion yen.

($1 = 149.9200 yen)