Japan logs trade deficit for 26th month in a row

TOKYO: Japan logged a 948.5 billion yen ($8.7 billion) trade deficit in August, the 26th straight month of red ink, as slack demand from China and the U.S. stymied exports, the Finance Ministry said Thursday. Exports fell 1.3 per cent from a year earlier to 5.71 trillion yen ($53.3 billion) while imports dropped 1.5 per cent to 6.65 trillion yen ($62.1 billion), resulting in a 948.5 billion yen ($8.8 billion) deficit, according to preliminary data. Japan posted a 971.4 billion yen deficit in August 2013.

A weakening in the value of the Japanese yen has so far failed to spur a rebound in exports, despite a recovering U.S. economy. Slower growth in China, Japan's biggest trading partner, has also hurt.

Consumer spending inside Japan also has been lackluster since an April 1 sales tax, reducing demand for imports.

Japan's exports to China fell 0.2 per cent from a year earlier to 1.12 trillion yen ($10.4 billion) while its imports dropped 5.3 per cent to 1.35 trillion yen ($12.6 billion), yielding a deficit of 233.9 billion yen ($2.2 billion).

SPONSORED CONTENT

Sabah revenue hits RM6.97 billion: Hajiji says GRS State Government may see full term

Kota Kinabalu: The Sabah Government continued its momentum in managing the economy in line with the commitment and spirit of the Sabah Maju Jaya (SMJ) when it posted record high state revenue of RM6.973 billion last year.

Exports to the U.S. fell 4.4 per cent, as car shipments faltered, to 1 trillion yen ($9.5 billion), though imports from the U.S. jumped nearly 11 per cent to 637.1 billion ($5.9 billion).

Overall, exports of vehicles, electronics and chemicals fell, while imports of coal and crude oil were lower.

The U.S. dollar hovered near 102 yen in August, as it had for months. In the past few weeks it has risen sharply. By late morning on Thursday it was trading at 108.55 yen.

A weaker yen means higher costs for imported oil and gas, components and other materials, manufacturers in the western industrial city of Osaka told visiting central bank governor Haruhiko Kuroda, local media reported.

Kuroda nonetheless offered an upbeat assessment of current trends, saying the recovery was gaining pace. In a speech posted on the Bank of Japan's website he said Japan would expand its ultra-loose monetary policy, aimed at stimulating growth, "without hesitation," if the outlook deteriorates.

Stay up-to-date by following Daily Express’s Telegram channel.

Daily Express Malaysia

Stronger growth in the U.S. may be crucial to Japan's own recovery, though so far it has had little impact on exports, said Yoshiro Sato of Credit Agricole.

"As we cannot expect too much for export recovery to China and Eurozone, near-term trade balance outlook will increasingly depend on how exports to the U.S. will play out," he said in a commentary. – AP

Try 1 month for RM 18.00

Try 1 month for RM 18.00

Try 1 month for RM 18.00