Japan Freight Transport Report Q1 2016
BMI View: The Japanese freight industry will once more be led by the rail sector in terms of y-o-y tonnage growth, pencilled in to come in at 3.30% in 2016.
Behind this mode will be air and road with annual growth of 1.30% and 0.34% respectively.
Stymieing freight growth to some degree over the short term at least is the fact that Japan's largest export market is the US, which recently overtook China and receives 20% of total exports.
The weakening JPY/USD exchange rate will continue to undermine Japanese exports in US dollar terms as any increase in shipment volumes fails to match up to the depreciation in the currency.
Contrary to mainstream belief, the weakening of the yen is undermining the Japanese economy, but its effects are being concealed by the windfall gains of lower energy imports.
The weakening yen continues to undermine Japan's economy by reducing export receipts in US dollar terms in spite of the rise in export volumes.
However, these negative effects are being concealed by the windfall gains of lower energy imports, which look likely to remain in place over the medium term.
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