Japan exports seen modestly higher on weak Asian demand

Workers are seen in a container area at a port in Tokyo, September 8, 2015. REUTERS/Toru Hanai

By Kaori Kaneko

TOKYO (Reuters) - Japan's exports were expected to rise only modestly in September, a Reuters poll found, a sign that stagnant Asian demand may be hampering Japan's hesitant economic recovery.

The trade data due on Wednesday could provide a strong clue to whether the economy will avoid recession after it shrank in April-June.

Exports were seen increasing 3.4 percent last month from a year earlier, the poll of 22 analysts found, after a 3.1 percent increase in August and a 7.6 percent gain in July.

"China's imports slumped, which also affected other Asian nations," said Takeshi Minami, chief economist at Norinchukin Research Institute.

"I think Japan's exports have already escaped from the worst period, but growth is unlikely to accelerate either."

The poll expected imports to fall 11.7 percent in September, down for a ninth straight month and reflecting falls in energy prices, which would result in a trade surplus of 84.4 billion yen.

It would be the first time in six months for Japan has posted a trade surplus. Revised data showed a trade deficit of 569.4 billion yen in August.

The Ministry of Finance will announce the trade data at 8:50 a.m. on Oct.21 (2350 GMT Oct. 20).

Earlier this month, the Bank of Japan declined to expand its stimulus drive even as slumping exports and falling oil prices threatened its rosy projection for price growth to achieve the BOJ's 2 percent inflation target next year.

The government cut its assessment of the economy this month as industrial production sagged and inventories rose. Fears of impending recession will keep the central bank under pressure to act at its meeting on Oct. 30.

(Reporting by Kaori Kaneko; Editing by Eric Meijer)