/www.fxserver.com/ Tokyo, Sept. 25 (Bloomberg) -- Japan's exports fell for a third month in August as U.S. demand slowed and the yen's 7.3 percent gain against the dollar this year cut the value of goods shipped by Canon Inc. and other manufacturers.
Exports fell 0.6 percent, seasonally adjusted, from July, a Finance Ministry report showed. Imports dropped 7.7 percent, widening the trade surplus to 924.9 billion yen ($7.5 billion). Economists expected a surplus of 830 billion yen after a 674.4 billion yen surplus in July.
Japan's recovery from recession may be cut short by the slowdown in the U.S., its biggest export market. Exports accounted for half the growth of the world's No. 2 economy in the second quarter, the first expansion in more than a year.
``The Japanese economy has been depending on exports for growth -- now the whole economy will slow down,'' said Kiichi Murashima, an economist at Nikko Salomon Smith Barney Ltd. ``We're in a lull.''
Stocks fell, led by Matsushita Electric Industrial Co., Nissan Motor Co. and other exporters. The Nikkei 225 Stock Average fell 0.3 percent to 9291.03 as of 11:02 a.m. Tokyo time after falling as much as 2.3 percent. The Topix Index shed 0.6 percent to 910.50.
Bonds rose on prospects that slowing U.S. growth would hurt Japan's economy. The yield on the No. 242 bond maturing in 2012 fell 3.5 basis points to 1.24 percent as of 11:05 a.m. in Tokyo. A basis point is 0.10 percentage point.
Moving Abroad
Canon, Japan's largest office-equipment company, said last week it would make four-fifths of its laser printers in China by 2003 to lower production costs, the Nihon Keizai newspaper reported. Canon cut its full-year profit forecast by 5.6 percent because of the stronger yen.
Japanese companies are vulnerable to a slump in the U.S., where growth slowed to an annual pace of 1.1 percent in the second quarter from 5 percent in the first. The U.S. Federal Reserve left interest rates at a 41-year low yesterday, citing a weak economy.
``With a slowdown in the U.S., and companies moving production abroad, I don't see another big export surge,'' said Taro Saito, an economist at NLI Research Institute.
From a year earlier, Japan's trade surplus widened to 644.1 billion yen in August, today's report showed. Exports rose 6.2 percent in August from a year earlier and imports fell 2.7 percent.