Japan's exports fell for the fifth month in a row in February, and although shipments to China picked up worries remain that fragile overseas demand could tip the world's third-largest economy into its fourth recession in five years.
Exports fell 4.0 percent year-on-year in February, Ministry of Finance data showed on Thursday, more than the median estimate for a 3.1 percent annual decline.
The improvement from January's 12.9 percent slump, the biggest decline in shipments since 2009, mainly reflected the bounce in sales to China as factories resumed operations after the Lunar New Year.
Still, while many analysts expect the economy to have rebounded modestly in the current quarter after shrinking in September-December, the bleak outlook for global demand has stoked worries about another contraction that will push Japan into its fourth recession in five years.
"The Lunar New Year is certainly a factor because Chinese factory activity slows to a trickle and then resumes very quickly," said Shuji Tonouchi, senior fixed income strategist at Mitsubishi UFJ Morgan Stanley Securities.
The Bank of Japan said on Tuesday it would maintain its massive asset buying programme at existing levels but offered a bleaker view of the economy, suggesting it may roll out more stimulus as it struggles to reach an elusive inflation target.
In February, Japanese exports to China rose 5.1 percent from a year earlier, the first increase in seven months, due to higher shipments of motors and metal processing equipment.
The Lunar New Year holidays came 10 days earlier than last year, meaning exports to China recovered sooner than usual, a finance ministry official told reports. Exports to Asia fell 6.1 percent in February from a year ago, slower than a 17.7 percent year-on-year decline in the previous month.
Shipments to the United States gained 0.2 percent in February from a year ago, versus a 5.3 percent annual decline in January.
Exports from South Korea and Taiwan tumbled in February, separate data showed earlier this month, in a warning sign that China's economic slowdown is putting the brakes on export-oriented economies.