Here’s our daily reading on whether Abenomics, the groundbreaking effort by Japanese Premier Shinzo Abe to re-energize Japanese growth, is showing results.
It is today. The value of Japanese exports in yen terms surged 10.1% in May, according to the latest data from the Japanese Ministry of Finance. Have a look.
It’s worth remembering that a big part of Abenomics is essentially devaluing the yen. That makes Japanese exports cheaper for foreign buyers. But it also raises the price of those exports in yen terms. So the numbers are a bit deceiving. Japanese export volumes were actually down in May compared to the same period of the prior year.
Also, there are two sides to trade statistics, exports and imports. And imports actually jumped too, thanks—again—to the weaker yen, which pushes up the prices of important necessities for Japan, such as buying energy from overseas. That means that Japan ran another trade deficit in May.
Even so, the export news was very good for corporate Japan. And its one of the reason we’ve seen Japanese giants, such as Toyota, raise their outlook for profitability in recent months. Japan’s stock market seemed to run with that, as the benchmark Nikkei rose 1.8% Wednesday.