Japan exports decline, capex outlook dims on weak demand

July had seen a decline in Japanese exports, tallying a double-digit drop for five consecutive months already as the virus crisis ravaged auto shipments to the United States. This dampened hopes for a trade-driven economic recuperation as the country suffers from recession.

Core machinery orders surprisingly dropped, hitting a seven-year low in June. Meanwhile, total exports plunged 19.2% in July from a year ago. The figure placed just below the 21.0% contraction predicted by markets and milder than the 26.2% drop in June, government data showed on Wednesday.

The grim set of figures indicates that the economic condition monitored in the second quarter showed no signs of improvement in the third quarter. This also brought more pressure as policymakers look for ways to stimulate economic activity.