Japan's Export Growth Unexpectedly Quickens to 7.7%

Japan's export growth unexpectedly quickened for the first time in three months, as shipments to Asia and Europe made up for declining U.S. sales.

Exports, which contributed almost half of the economy's expansion last quarter, rose 7.7 percent in January from a year earlier after increasing 6.9 percent in December, the Finance Ministry said today in Tokyo. The median estimate of 18 economists surveyed by Bloomberg News was for a 6.6 percent gain.

Toyota Motor Corp. and Honda Motor Co. are relying on consumers in China, Russia and India to make up for waning demand in the U.S., Japan's largest market. Exports may cool this year as the U.S. slowdown spreads around the world.

``It's too early to conclude that the EU and Asia will continue to offset the impact of the U.S. slowdown,'' said Seiji Adachi, a senior economist at Deutsche Securities Inc. in Tokyo. ``Japan's exports are likely to slow as they rely heavily on the U.S. and U.S-led demand overseas.''

The yen traded at 108.08 per dollar at 10 a.m. in Tokyo from 107.99 before the report was published.

Exports to Asia and Europe rose to a record for January, a month in which the volume of trade is lower because Japan's ports are closed for three days to celebrate the new year.

Shipments to Europe rose 10.6 percent, five times the pace of the previous month. Exports to Asia climbed 8.2 percent, the same rate as December, while those to China gained 4.6 percent.

U.S. exports, meanwhile, fell 3.2 percent from a year earlier, a fifth monthly drop.