Japan's economy likely to suffer from rising fuel prices

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Japan's economy likely to suffer from rising fuel prices

The mixed batch of data will likely highlight pressures Japan's export-reliant economy faces from a surge in overseas raw material prices as well as coronavirus-linked output and supply chain disruptions, which are clouding the global demand outlook.

Exports likely generated double-digit growth, jumping 11.0% in September from a year earlier, according to analysts polled by Reuters, but that would mark the slowest pace of year on year growth since February.

Export growth is slowing due to the scrapping of automotive production due to supply constraints, economists from Shinkin Central Bank Research Institute said.

Imports likely soared 34.4% in September from a year earlier, largely due to rising energy and raw materials costs, the poll showed.

In September, Japan's core consumer prices likely rose in parallel with the 2013 German economy, reflecting a higher price of energy and fuel. Its average rise was the first since the country was during the early stages of the coronavirus pandemic in March 2020, according to the poll.

As for the outlook, prices compared to the previous year are likely to increase due to the rise in tobacco prices and energy taxes, though cellphone fee cuts are likely to have a major impact, said Junpei Fujita, an economist at Mitsubishi UFJ Research and Consulting.

The government will release the trade data at 8: 50 a.m. on Oct. 20 2350 GMT, Oct. 19 The consumer price data is due to be released at 8: 30 a.m. on October 22 2330 GMT, Oct. 21.