Japanese exports fell by more than analysts expected as Chinese consumers failed to offset falling demand in Europe, Reuters reported. Japan’s exports dropped 8.1% year-on-year in July, the largest fall in six months. Exports to Europe fell by 25.1%, the largest decline since October 2009, while exports to China, Japan’s biggest trading partner, fell 11.9% year-on-year. Overall Japan’s trade deficit clocked in at a larger-than-expected US$6.5 billion. “We hoped domestic demand in China would support Japan’s economy, but the story is different,” said Masayuki Kichikawa, chief Japan economist at Bank of America-Merrill Lynch. Other analysts noted that trade figures had slumped across East Asia; Chinese exports were up just 1% in July. “It’s hard to be optimistic given what’s happening in key trading partners,” said Robert Prior-Wandesforde, director of Asian economics at Credit Suisse.
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