Japan logged its worst-ever monthly trade deficit last month despite an upturn in exports as the yen’s recent sharp drop pushed fuel costs higher, official data showed yesterday.
The world’s third-biggest economy is mired in recession and a mood of optimism in the stock market and among analysts has so far failed to translate into good macroeconomic figures. The finance ministry data showed Japan suffered a shortfall of ¥1.63 trillion (US$17.4 billion) last month, the worst deficit on record for a single month, exceeding the previous record of ¥1.48 trillion for the same month last year.
Comparable data began in 1979. Japan tends to post bad trade figures in January, with exports stalling because of the New Year holidays.
Economists on average had expected a shortfall of ¥1.3 trillion.
Taro Saito of the NLI Research Institute said the deficit did appear “a lot worse than I had expected.”
“Overall, you can’t make the deficit go away that easily,” Saito told Dow Jones Newswires, adding that Japan would likely see deficits over the coming months.
Exports last month increased 6.4 percent from a year earlier to ¥4.8 trillion, the first rise in eight months on higher shipments of automobile parts and other items.
However, imports rose 7.3 percent to ¥6.43 trillion, boosted by heavier bills for petroleum products, natural liquefied gas and crude oil.
Japan’s fuel imports have risen since the 2011 earthquake and tsunami disaster sparked the world’s worst nuclear accident in a generation, sending most atomic power plants offline.
However, the cost of imported fuel, which is denominated in US dollars, has risen for Japan as the yen has tumbled over the past few months, driven by expectations of aggressive monetary easing under Japanese Prime Minister Shinzo Abe.
The US dollar’s average rate last month was ¥86.93 against ¥77.33 a year earlier, according to customs data, meaning the yen was 12.4 percent cheaper.
A lower yen is good for Japanese exporters, but there have been accusations in recent weeks, particularly in Europe, that Tokyo is deliberately trying to manipulate currency rates.
“The huge deficit at the beginning of the year is, as we expect, likely to result in the annual trade balance remaining in deficit for the third straight year in 2013,” Credit Agricole economist Yoshiro Sato said.
However, the latter half of the year is likely to see a narrowing deficit on the back of a recovery in global demand, he said.
Analysts had expected a boost in exports last month due to the yen’s sharp decline and a recovery in trade with China.
Exports to China rose 3 percent last month with emotions over a territorial dispute easing. The row sparked huge anti-Japan protests across China and a consumer boycott.
US-bound exports soared 10.9 percent on strong shipments of automobiles and their parts. Exports to the EU fell 4.5 percent, narrower than double-digit plunges in past months.
NO HUMAN ERROR: After the incident, the Coast Guard Administration said it would obtain uncrewed aerial vehicles and vessels to boost its detection capacity Authorities would improve border control to prevent unlawful entry into Taiwan’s waters and safeguard national security, the Mainland Affairs Council (MAC) said yesterday after a Chinese man reached the nation’s coast on an inflatable boat, saying he “defected to freedom.” The man was found on a rubber boat when he was about to set foot on Taiwan at the estuary of Houkeng River (後坑溪) near Taiping Borough (太平) in New Taipei City’s Linkou District (林口), authorities said. The Coast Guard Administration’s (CGA) northern branch said it received a report at 6:30am yesterday morning from the New Taipei City Fire Department about a
IN BEIJING’S FAVOR: A China Coast Guard spokesperson said that the Chinese maritime police would continue to carry out law enforcement activities in waters it claims The Philippines withdrew its coast guard vessel from a South China Sea shoal that has recently been at the center of tensions with Beijing. BRP Teresa Magbanua “was compelled to return to port” from Sabina Shoal (Xianbin Shoal, 仙濱暗沙) due to bad weather, depleted supplies and the need to evacuate personnel requiring medical care, the Philippine Coast Guard (PCG) spokesman Jay Tarriela said yesterday in a post on X. The Philippine vessel “will be in tiptop shape to resume her mission” after it has been resupplied and repaired, Philippine Executive Secretary Lucas Bersamin, who heads the nation’s maritime council, said
REGIONAL STABILITY: Taipei thanked the Biden administration for authorizing its 16th sale of military goods and services to uphold Taiwan’s defense and safety The US Department of State has approved the sale of US$228 million of military goods and services to Taiwan, the US Department of Defense said on Monday. The state department “made a determination approving a possible Foreign Military Sale” to the Taipei Economic and Cultural Representative Office in the US for “return, repair and reshipment of spare parts and related equipment,” the defense department’s Defense Security Cooperation Agency said in a news release. Taiwan had requested the purchase of items and services which include the “return, repair and reshipment of classified and unclassified spare parts for aircraft and related equipment; US Government
More than 500 people on Saturday marched in New York in support of Taiwan’s entry to the UN, significantly more people than previous years. The march, coinciding with the ongoing 79th session of the UN General Assembly, comes close on the heels of growing international discourse regarding the meaning of UN Resolution 2758. Resolution 2758, adopted by the UN General Assembly in 1971, recognizes the People’s Republic of China (PRC) as the “only lawful representative of China.” It resulted in the Republic of China (ROC) losing its seat at the UN to the PRC. Taiwan has since been excluded from