The Japanese economy is feeling the pain of a slowing world economy — and Chinese anger over a territorial dispute. Japan’s export fell for the fifth straight months, dropping 6.5% in October, compared to the same time last year. Economists had expected a decline of just 4.9%, Reuters noted.
Falling exports have led to the fourth consecutive monthly trade deficit — meaning Japan is importing more than it exports. Japanese exports have been battered by the rising value of the yen, which places its goods and services at a price disadvantage, and soft demand in Europe and North America.
Also driving the drop in Japanese exports is a consumer boycott in China. A dispute over the Senkaku islands, a chain of tiny, barren islands in the East China Sea, inflamed nationalist sentiment in China, leading many Chinese consumers to look to products from other nations.
Japan’s exports to China tumbled 11.6% in October compared to last year. But that was less than the 14.6% year-over-year declined registered in September, suggesting that Chinese anger may be cooling.