TOKYO - Japan's export growth slowed for a fifth straight month in July, official data showed Wednesday, amid signs a fragile recovery was continuing to lose steam, with the strong yen posing a threat.
Exports jumped 23.5% to 5.98 trillion yen ($70.9 billion), less than June's 27.7% but above market expectations of 21.8%. Imports rose 15.7% to 5.18 trillion yen, the finance ministry said.
Strong demand for automobiles, high-tech products and factory parts have helped offset a weaker domestic picture, enabling Japan's biggest companies to return to profit and bring about a tentative economic recovery.
But exporters are eyeing the yen's recent rise to 15-year highs against the dollar with anxiety amid calls for government action, as a strong domestic unit erodes overseas profits when repatriated.
On Tuesday the yen reached 83.61 to the dollar, its highest since 1995.
There is also concern about the impact the withdrawal of global stimulus measures and European debt will have on Japanese exports, with equipment and components makers also facing a knock-on effect from falling demand for Chinese goods.
Analysts warn that risks to demand remain as world leaders embrace tighter fiscal policies to help rebalance a global economy knocked off its axis by the financial crisis.
Japan's growth slowed in the second quarter to an annualized 0.4%, down from 4.4% in the previous three months with the economy outpaced by China on nominal terms. June saw industrial output take a surprise fall.
However, in July Japan logged its first trade surplus with China in four months, estimated at 15.8 billion yen.
Exports to China, a major driver of the Japanese economy, rose 22.7% to 1.16 trillion yen, while Chinese imports to Japan increased 14.4 percent to 1.14 trillion yen.
Overall, Japan's trade surplus soared 119.9% in July from a year earlier, as recovery of exports outpaced that of imports, according to the finance ministry.
The surplus reached 804.2 billion yen in July, marking the 14th straight month of improvement on year-earlier levels. The figure was significantly larger than market expectations of 457 billion yen.
Auto and steel exports continued to rise in the month, boosted by strong Asian demand, while imports of liquid natural gas, iron ore and other natural resources increased.
Japanese exports to the United States rose 25.9% to 972.2 billion yen, while US imports to Japan rose 13.4% to 499.9 billion yen.
Against the European Union members, Japanese exports rose 13.3% to 632.6 billion yen, while European imports rose 9.5% to 4.99 billion yen.