Falling exports and weak household spending seen slowing Japan's third quarter growth - poll

A laborer works in a container area at a port in Tokyo, Japan, March 16, 2016. REUTERS/Toru Hanai/File Photo

By Tetsushi Kajimoto

TOKYO (Reuters) - Japan's exports and household spending were expected to fall in the year to September, a Reuters poll found on Friday, in a sign weakness in external and domestic demand could weigh on economic recovery in the third quarter.

Separate data are expected to show that core consumer prices fell for a seventh straight month in the year to September while the jobless rate and the job availability held steady, underlining weak inflation despite a tight labour market.

Next week's run of data comes ahead of the Bank of Japan's policy-setting meeting on Oct. 31-Nov. 1, when it will also issue fresh quarterly growth and inflation forecasts.

The BOJ is likely to trim next fiscal year's price forecast, sources say, but it is seen holding off on expanding stimulus after having just rebooted its policy framework last month.

"Japan, as well as global economy, is in a cyclical pickup, but special factors such as China's output adjustment due to the G20 summit and a bad weather hurt exports and household spending respectively in September," Masaki Kuwahara, a senior economist at Nomura Securities said. "As such, the third quarter GDP may not have grown much."

Ministry of Finance data is expected to show exports fell 10.4 percent in the year to September, the poll of 20 economists showed, due to sluggish external demand and the yen's gains by some 16 percent versus the dollar from a year earlier.

Imports were expected to have dropped 16.6 percent in September from a year earlier, swinging the trade balance to a surplus of 341.8 billion yen (2.68 billion pounds).

The trade data is due 8:50 a.m. Oct. 24 (2350 GMT Oct 23.) Other indicators will be issued at 8:30 a.m. Oct. 28 (2330 GMT Oct 27.)

Separate data from the internal ministry is expected to show household spending fell 3.0 percent in the year to September, as a rainy weather and typhoons dampened private consumption, which constitutes about 60 percent of the economy.

That would follow a 4.6 percent drop in August and mark a seventh straight month of annual declines.

The core consumer price index (CPI), which includes oil products but excludes volatile fresh food prices, was expected to show a fall of 0.5 percent in September from a year earlier, unchanged from August's decline.

The poll found that the jobless rate was expected to hold steady at 3.1 percent in September, near a 21-year low of 3.0 percent hit in July and a level seen as near full employment. The jobs-to-applicants ratio was probably unchanged at 1.37, a 25 year high.

(Reporting by Tetsushi Kajimoto; Editing by Eric Meijer)