Although the Japanese economy fell into a recession over the last quarter, it doesn’t mean that it’s giving up just yet.
Recent data revealed that there was some economic growth last month, encouraging those worried about the economy to expect some recovery over the next year.
Exports in Japan grew during the month of October, hitting the fastest pace seen in about eight months. The rate rose at 9.6 percent; this was considered ‘more than double’ the originally predicted amount, which was a gain of 4.5 percent. It was also considerably more than the growth seen in September: a 6.9 percent annual increase.
Japan exports rose in October for several reasons. The country exported a higher amount of ships, cars and electronics shipments than expected. Exports to the rest of Asia also rose, rising to 10.5 percent. More than half of the nation’s shipments are exported to many parts of Asia.
But, exports to the United States also rose. United States exports doubled to 8.9 percent throughout the month of October. Total exports increased to 2.9 percent annually in October, considered decidedly lower than the 3.4 percent prediction. All in all, October ended in a trade deficit of 710.0 billion yen ($6.01 billion), much lower than the initially surmised 1.05 trillion yen deficit.
More good news broke over the past week, too. A private survey revealed that factory output [in Japan] regained its footing, growing at its fastest pace throughout the month of November. That’s the fastest pace seen since March of this year.
Although the news of recession shocked Japanese policymakers, the recent data shows that rising exports and output can potentially help see the economy recover faster than expected.
The trade data certainly reveals that the Japanese economy is capable of recovery at a faster pace than expected. According to economic strategists, the current data shows a trend that indicates ‘the role of exports helping contribute to growth throughout the fourth fiscal quarter.’
It can, if it goes well, help ‘bolster Japan’s current economic weaknesses in the domestic market.’