Japan’s January exports slide the most in 2 years

Exports in Japan fell the most in more than two years in January, following a sharp fall in orders for the country’s machinery goods and weakened business confidence sentiments.

Japan’s January exports fell by 8.4% compared to a year ago, extending from the 3.9% decline in December, data from the Ministry of Finance showed on Wednesday. January’s reading was worse than the 5.5% decline economists in a Reuters poll had expected.

The fall last month marks the sharpest plunge since October 2016.

The export results follows weak overseas orders for machinery which fell the most in more than a decade in December. This is as trade friction between China and the United States (US) are stalling global supply chain demand.

Japanese exports to China, Japan’s biggest trading partner, fell by 17.4% for last month, but the fall could have been partly due to slower shipments ahead of the Chinese New Year holidays which took place in early February.

Japan’s shipments to Asia, which amounts to more than half of overall exports, fell 13.1% for last month, extending from the 6.9% decline in December.

For last year, the annual growth in exports eased to 4.1% from 11.8% in 2017, due partly to the trade tensions caused between China and the US, which affected orders.

On Tuesday, US president Donald Trump said that the trade talks with China are progressing well. The US president also hinted on being open to pushing off the trade truce deadline to finalize negotiations between both parties.