Japan's exports decline most since 2009 as Covid-19 hits US-bound shipments

The trade data came a day after the Bank of Japan increased its support through lending schemes for struggling businesses to $1 trillion.

Japan's exports fell in May at the fastest pace since the 2009 global financial crisis as U.S.-bound car shipments plunged, bolstering expectations for a deep contraction in the world's third-largest economy this quarter.

Weak global demand for cars and slowing business spending could drag on Japan's export-led economy, even as China-bound trade shows signs of picking up and U.S. and European economies reopen.

The trade data came a day after the Bank of Japan increased its support through lending schemes for struggling businesses to $1 trillion.

Ministry of Finance (MOF) data out Wednesday showed Japan's exports fell 28.3% in the year to May, worse than a 26.1% decrease expected by economists in a Reuters poll.

That followed a 21.9% decline in April and marked the biggest annual drop since September 2009.

U.S.-bound exports - Japan's key market -- halved to mark the biggest annual drop since March 2009, due to more than 70% declines in shipments of cars and car parts, the trade data showed.

Exports to China, Japan's largest trading partner, fell 1.9% in the year to May, a smaller drop than the prior month's 4% annual decline.

Shipments to Asia, which account for more than half of Japanese exports, declined 12%, and exports to the European Union also fell 33.8%.