TOKYO (Reuters) – Japan’s exports likely extended declines in October but at a slower pace as improving global demand helped some parts of the trade sector, data next week is expected to show, although a recent resurgence in coronavirus cases complicates the outlook.
Other key data due next week includes core consumer inflation, which is forecast to show the biggest fall in prices since early 2011 as the impact from a sales tax hike last year fades and private demand remains weak due to the pandemic.
Exports were seen falling 4.5% in October from a year earlier, slowing from a 4.9% decline in September, the poll of 17 economists showed.
Imports were expected to have fallen 9.0% in October from a year earlier, which would result in a trade surplus of 250 billion yen ($2.38 billion).
“Exports are recovering in volume but the pace of recovery could slow amid uncertainties, such as an increase in coronavirus cases in Europe,” said Yusuke Shimoda, senior economist at Japan Research Institute.
Prime Minister Yoshihide Suga has instructed his cabinet to come up with another stimulus package as the pandemic persists.
The government has so far compiled two packages worth a combined $2.2 trillion to ease the pain from the health crisis.
The finance ministry releases trade data at 8:50 a.m. on Wednesday (2350 GMT Tuesday).
The core consumer price index (CPI), which includes oil products but excludes volatile fresh food prices, is forecast to have dropped 0.7% in October from a year earlier, the poll found.
That would be the fastest decline since March 2011 when the index also fell 0.7%.
The boost to prices from the sales tax hike last year has eased while a national campaign promoting domestic travel is also among factors behind declines in the core CPI, economists say.
The government announces CPI at 8:30 a.m. on Friday.
($1 = 104.8800 yen)
(Reporting by Kaori Kaneko; Editing by Sam Holmes)