TOKYO (Reuters) – Japan’s exports likely posted their largest monthly rise in four decades in May, a Reuters poll showed on Friday, but the flattering milestone was largely reflective of a rebound in shipments from last year’s pandemic-driven plunge.

Globally, policymakers are keeping a close watch on the extent of underlying demand recovery as COVID-19 vaccinations have improved economic conditions in some key economies.

A marked recovery in Japan’s exports and output due to surging global demand has helped its economy offset lacklustre conditions at home, after the government recently extended coronavirus emergency curbs in Tokyo and other major areas.

Next week’s key data include machinery orders and consumer prices, as well as a Bank of Japan policy meeting.

Exports likely soared 51.3% in May compared to the same month a year earlier, the poll of 17 economists showed.

That would mark the sharpest monthly rise since April 1980, when shipments jumped 51.4%, a finance ministry official said. The annual uptick in exports largely reflected the recoil effect of the 28.3% plunge in May of 2020.

Imports were forecast to have jumped 26.6% year-on-year in May, which would result in a trade deficit of 91.2 billion yen ($833.7 million).

“Exports in May… likely posted a larger gain than they did in the previous month,” said Kenta Maruyama, an economist at Mitsubishi UFJ Research and Consulting.

“On a (month-on-month) seasonally adjusted basis, they probably decreased slightly, though global demand from capital investment remains high.”

The finance ministry announces trade data at 8:50 a.m. on Wednesday (2350 GMT Tuesday).

Core machinery orders data, which exclude those for ships and electrical utilities, are also scheduled to be released on Wednesday.

The poll showed core machinery orders in April were likely to have increased 8.0% year-on-year, and to have gained 2.7% from the previous month.

The core consumer price index (CPI), which includes oil products but excludes volatile fresh food prices, is expected to have risen 0.1% in May compared to the same month a year earlier, according to the Reuters poll.

That would mark the first month of year-on-year price growth since March last year.

The poll also showed the Bank of Japan is expected to keep its policy interest rate at minus 0.1% and the 10-year Japanese government bond yield target at around 0% at its policy meeting on June 17-18.

($1 = 109.3900 yen)

(Reporting by Daniel Leussink; Editing by Shri Navaratnam)

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