Japan’s trade deficit widened last month, as the nation’s import bill continued to rocket upward, fueled by a historic slide in the yen that has already helped push the economy back into reverse.
The trade gap grew to ￥2.16 trillion (US$15.5 billion) from ￥2.09 trillion, the Japanese Ministry of Finance reported yesterday.
The balance has now been negative for 15 straight months, the longest streak since 2015. Economists had expected a ￥1.62 trillion deficit.
Photo: EPA-EFE
Imports grew at the fastest pace since 1980 as the yen inflated already elevated commodity prices. The 53.5 percent gain was led by buying of crude oil, liquid natural gas and coal. Analysts had expected a 50 percent rise in inbound shipments.
Exports gained 25.3 percent driven by vehicles and semiconductor parts, for a slightly weaker increase than forecast by economists.
The prolonged trade deficit reflects Japan’s still fragile recovery from the COVID-19 pandemic, and came after the nation’s economy unexpectedly shrank in the third quarter, weighed down in part by the impact of the tumbling currency.
The streak of red trade ink is likely to keep feeding back into yen weakness, although the currency has made some gains this month.
The trade data showed that the average exchange rate was ￥145.09 to the US dollar, 30 percent weaker than a year earlier. The yen neared ￥152 per US dollar at one point last month, hitting a fresh 32-year low.
Following its first intervention to support the yen since 1998 in September, the Japanese government continued to step into markets again last month.
The trade outlook is further clouded by the prospect of a global slowdown as the impact of higher interest rates overseas weighs on demand.
For now, exports continue to rack up solid gains, with shipments to the US rising 36.5 percent from a year earlier to outstrip the total to mainland China.
Exports to China grew 7.7 percent for the smallest increase since June. Outbound shipments to Europe gained 28.1 percent.
Domestically, the weak yen has driven up energy costs and inflation rates, affecting Japanese households and companies. The nationwide core consumer price index hit 3 percent in September for the first time in more than three decades excluding the impact of tax hikes.
This month’s figure, which is to be announced today, is projected to be even higher at 3.5 percent.
To ease the hit of higher prices on consumption, Japanese Prime Minister Fumio Kishida last month ordered an economic stimulus package that includes aid to reduce energy costs and cash handouts for childcare.
His Cabinet has approved an extra budget of ￥29.1 trillion to partly fund the measures.
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his
ADVERSARIES: The new list includes 11 entities in China and one in Taiwan, which is a local branch of Chinese cloud computing firm Inspur Group The US added dozens of entities to a trade blacklist on Tuesday, the US Department of Commerce said, in part to disrupt Beijing’s artificial intelligence (AI) and advanced computing capabilities. The action affects 80 entities from countries including China, the United Arab Emirates and Iran, with the commerce department citing their “activities contrary to US national security and foreign policy.” Those added to the “entity list” are restricted from obtaining US items and technologies without government authorization. “We will not allow adversaries to exploit American technology to bolster their own militaries and threaten American lives,” US Secretary of Commerce Howard Lutnick said. The entities
Minister of Finance Chuang Tsui-yun (莊翠雲) yesterday told lawmakers that she “would not speculate,” but a “response plan” has been prepared in case Taiwan is targeted by US President Donald Trump’s reciprocal tariffs, which are to be announced on Wednesday next week. The Trump administration, including US Secretary of the Treasury Scott Bessent, has said that much of the proposed reciprocal tariffs would focus on the 15 countries that have the highest trade surpluses with the US. Bessent has referred to those countries as the “dirty 15,” but has not named them. Last year, Taiwan’s US$73.9 billion trade surplus with the US
Prices of gasoline and diesel products at domestic gas stations are to fall NT$0.2 and NT$0.1 per liter respectively this week, even though international crude oil prices rose last week, CPC Corp, Taiwan (台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. International crude oil prices continued rising last week, as the US Energy Information Administration reported a larger-than-expected drop in US commercial crude oil inventories, CPC said in a statement. Based on the company’s floating oil price formula, the cost of crude oil rose 2.38 percent last week from a week earlier, it said. News that US President Donald Trump plans a “secondary
RSS