Japan trade data likely disappointed in February

Japan will release February trade data on 18 March.

Standard Chartered notes as follows..

• We expect exports to have contracted by 1.0% y/y after they spiked 17% y/y in January, and imports to have increased 7.0% y/y after a 9.0% decline in January.
• As a result, the trade deficit likely widened to JPY 1.3tn from JPY 1.1tn. Exports declined 0.6% y/y in the first 20 days of February, while imports increased 9.9% y/y. 
  
  
• Exports to China surged 20.8% y/y in January, and exports to the US grew 16.5% y/y. Exports to China likely slowed in February on a slowdown in domestic demand in China, while exports to the US likely remained strong. 
  
  
• We expect import growth to have accelerated in February, mainly owing to a favourable base effect. We think the trade deficit will narrow this year.