Feb. 23 (Bloomberg) -- Japanese exports rose for a third month in January, and the trade surplus held near a four-year high, allaying concern the yen's advance against the dollar will hamper a recovery in the world's second-biggest economy. Exports rose 0.9 percent from December, and imports gained 1.8 percent, the Ministry of Finance said in Tokyo. The surplus narrowed a less-than-expected 2.1 percent to 1.1 trillion yen ($10.13 billion), seasonally adjusted, from 1.12 trillion yen in December, which was the highest since February 2000. Overseas sales by companies including Tokyo Electron Ltd. and Murata Manufacturing Co. helped the economy grow at the fastest pace in 13 years last quarter. Rising global demand for Japanese products is offsetting the effects of the yen's 9 percent gain against the dollar in the past year, economists and company executives said.
``Japanese companies are exporting more as the growth in the U.S. is good, and China and Southeast Asia have been strong too,'' Kakutaro Kitashiro, head of the Japan Association of Corporate Executives and chairman of IBM Japan Ltd., said last week at a press conference. The yen strengthened to 108.26 yen to the dollar at 5:39 p.m. in Tokyo from 109.05 yen late Friday in New York. The trade surplus beat expectations partly because export volumes gained 13.3 percent from a year earlier, the most since February 2000. The median forecast of 10 economists was for the surplus to narrow to 839.5 billion yen in January from December, according to a Bloomberg News survey of 10 economists.
Asian Demand
``We're not seeing the stronger yen affecting exports,'' because of strong demand from China and the rest of Asia, said Yasuo Goto, a senior economist at Mitsubishi Research Institute and a former Bank of Japan official. ``Exports still have room to grow in the coming months.'' The yen's 11 percent gain against the dollar last year prompted the Bank of Japan to sell a record 20.1 trillion yen to weaken the currency and protect the nation's export-led recovery. The currency fell 3.3 percent last week as the Finance Ministry said it will keep selling yen. The Nikkei 225 Stock Average rose 1.4 percent to 10,868.96 at the 3 p.m. close in Tokyo, led by exporters such as TDK Corp. and Honda Motor Co., on optimism the dollar's gain last week will help boost the value of overseas earnings.
Export Volumes
From a year earlier, the trade surplus widened to 507.1 billion yen from 102.8 billion yen, the ministry said. Exports rose 11 percent, led by audio and visual equipment, semiconductors, and electrical machinery. Imports grew 0.8 percent from a year earlier. Tokyo Electron, the world's second-largest supplier of chipmaking equipment, this month raised its profit forecast more than four-fold to 4.5 billion yen for the year ending March, as orders for chipmaking equipment rose to meet growing demand for consumer products such as cellular phones and digital cameras. Murata Manufacturing, the world's biggest maker of ceramic capacitors used to regulate electricity in mobile phones and computers, this month said third-quarter net income rose 14 percent to 10.8 billion yen because of increased demand for parts used in the electronics.
Growing investment by companies such as Sharp Corp. and Canon Inc. accounted for half of Japan's 7 percent annual pace of economic growth in the three months to Dec. 31. Net exports and consumer spending each accounted for another quarter of growth. Japanese exporters are getting a lift from economic growth in the U.S. and China. China's economy will probably grow 8.5 percent in the first quarter from a year earlier, compared with 9.9 percent growth in the fourth quarter, the Ministry of Commerce in Beijing said this month. The U.S. economy, the world's biggest, grew at a 4 percent annual pace in the fourth quarter. //www.bloomberg.com