JAPAN’S export growth snapped seven months of double-digit expansion in October due to slowing U.S. and China-bound car shipments, highlighting risks for the export-reliant economy from global supply constraints.

The slowing growth shows Japan’s vulnerability to supply chain bottlenecks that have been particularly disruptive for the car industry and have clouded the outlook for overseas demand.

Exports rose 9.4 percent year on year in October, Ministry of Finance data showed yesterday, slightly below a median market forecast for a 9.9 percent rise in a poll. It followed 13 percent growth in the prior month.

By region, exports to China, Japan’s largest trading partner, increased 9.5 percent in the 12 months to October, slowing from 10.3 percent in the previous month as car shipments to the country fell 46.8 percent.

U.S.-bound shipments, another key market for Japanese goods, grew just 0.4 percent in October, also weighed by declining car exports, which fell 46.4 percent.

Imports rose 26.7 percent in the year to October, versus the median estimate for a 31.9 percent increase, bringing the trade balance to a deficit of 67.4 billion yen (US$586.60 million), compared with the median estimate for a 310.0 billion yen deficit.

Separate government data showed core machinery orders, which serve as a leading indicator of capital spending in the coming six to nine months, were flat in September from the prior month, below with an expected 1.8 percent gain.

The weaker-than-expected core orders signal corporate Japan’s reluctance to commit to firmer capital spending as global supply bottlenecks pose a risk to the outlook for output and exports.

Manufacturers expected core orders to rise 3.1 percent in the October-December period, after a 0.7 percent gain in the previous quarter. (SD-Agencies)