Overview

• July marked a third straight monthly decline in exports, exceeding forecasts after a 0.5% fall in June.
• Shipments to the United States fell 10.1% from a year earlier and exports to China dropped 3.5%.
• Japan posted a 117.5 billion yen trade deficit in July, missing expectations for a surplus as imports fell 7.5%.
• Washington’s late-July deal with Tokyo lowered the threatened reciprocal tariff to 15%, including on autos, with the impact expected to appear from August.
• The weak trade reading followed a Q2 GDP beat driven by net exports, while economists warn tariffs could weigh on growth and raise recession risk.