Japan's exports fell during May at their fastest pace since the global financial crisis in 2009, in light of the sharp decline in car sales destined for the United States, which widened the deepening contraction in the growth rates in the third largest global economy during the second quarter of this year.
Japan's exports fell at an annual level of 28.3%, the largest drop since September 2009, and expectations were for a decrease of 26.1% while the previous reading indicated a drop of 21.9%.
Exports to the United States, Japan's main market, halved, marking the largest annual decline since March 2009 due to a more than a 70% drop in shipments of cars and auto parts.
On the other hand, the annual imports in Japan decreased by 26.2% from a previous decrease of 7.1%, which resulted in a trade deficit of 833.4 billion yen, compared to a deficit of 931.9 billion yen in April.
Exports to China, Japan's largest trading partner, fell by 1.9% in the year to May, due to a drop in chemical raw materials, cars and chip making equipment. This was followed by the 4% annual decrease for the previous month.
The Japanese economy plunged into recession for the first time in four and a half years in the first quarter of 2020 and is on the way to a deeper recession since the post-war period, as the pandemic destroyed companies and consumers.
On Tuesday, the Bank
of Japan increased its support through boosting corporate lending to $1
trillion, following government efforts to stop the economy from sliding deeper
into recession with fiscal stimulus packages worth $2.2 trillion.