U.S. GDP announced at 9:30 p.m. Record-setting deterioration due to the effects of the Corona Virus or July 30 at 5:51 p.m.
U.S. GDP from April to June will soon be announced. In the past three months, a record deterioration is expected due to the simultaneous suspension of economic activities such as the closure of stores and the shutdown of factories in response to the spread of the new coronavirus infection.
The preliminary figures for U.S. GDP from April to June will be released at 9:30 p.m. Japan time.
Market estimates that GDP growth is actually in terms of annual rates, at minus 35% compared to the previous three months, the worst level since 1947, when quarterly statistics began.
Compared to the worst three-month level of minus 8% during the year of the Lehman shock in 2008, the magnitude of the blow to the economy is the spread of the new virus.
Meanwhile, due to restrictions on going out in various states across the United States and the closure of restaurants, McDonald’s, a major hamburger chain, posted a significant decline of minus 68%, and 60% of small and medium-sized restaurants that were closed were forced to close.
In addition, the number of passengers in aviation and hotels dropped sharply, and production of factories fell sharply in the manufacturing industry such as automobiles, and economic activities stopped almost all at once.
For this reason, there have been a series of moves among stores and companies to lay off employees, and the foundation of people’s lives has also been shaken, with the unemployment rate remaining high at more than 10%.
The world’s largest developments in the U.S. economy have an impact on Japan and the world as a whole, so there is interest in the content of GDP.
Exports to the U.S. decline sharply
Exports from Japan to the U.S. have declined significantly due to stagnation in economic activity caused by the spread of the new coronavirus infection, which has had a significant impact on Japanese companies.
According to the Trade Statistics of the Ministry of Finance, exports from Japan to the United States amounted to more than 15.2 trillion yen in the past year, and the United States is the largest export partner (19.8%) accounting for one-fifth of all exports.
However, exports to the U.S. have been declining for the 11th consecutive month since August last year, and have declined significantly, especially since April, when the new coronavirus infection spread, due to stagnation in economic activity.
Compared to the same month last year, the rate decreased significantly to 37.8% in April, 50.6% in May, and 46.6% in June.
Looking at exports by item in June, “automobiles” decreased 63.3% from the same month last year to 137.8 billion yen, “motor” including engine parts for aircraft decreased 56% to 35.8 billion yen, and “automotive parts” decreased 58.3% to 29.1 billion yen.
In addition, manufacturing equipment such as semiconductors, which is indispensable for the manufacture of smartphones and personal computers, also declined 41.4% to 31.7 billion yen.
In addition, construction and mining machinery decreased by 44.1% at 23.9 billion yen and “metal products” by 53.8% to 10.1 billion yen, respectively, and decreased in all items except “pharmaceuticals”.
Significant impact on Japanese oems
The U.S. is the world’s second-largest automotive market, and the economic downturn caused by the spread of the new coronavirus has had a significant impact on the production of Japanese manufacturers.
Toyota Motor Corp., Honda Motor Co., Ltd., Nissan Motor Co., Ltd., and Subaru, which produce local cars, have been forced to suspend operations at their plants since late March.
As a result, production in the U.S. in April was an unusual situation in which the entire company was “zero” in April.
After that, manufacturers resumed production due to the easing of outing restrictions, but production in May also decreased by 83% compared to the same month last year.
In June, sales declined by 19%, but it is still unclear how far production and sales will recover due to the spread of the new coronavirus infection again.
Makoto Uchida, president of Nissan Motor Co., Ltd., said at a press conference on August 28 that “the United States has become very stricter over the past two months.”
On top of that, he expressed his intention to keep a close eye on market developments, saying that the global market environment could deteriorate further due to the so-called second wave, but it is currently difficult to predict the impact.
JETRO ‘concerned about exports to rice’
Regarding the GDP of the U.S., which is expected to deteriorate on record due to the new coronavirus, Nobuhiko Sasaki, president of the Japan External Trade Organization, said at a press conference on June 30, “I am concerned about what will happen to Japan’s exports to the United States. I would like to keep an eye on the situation in the future.”