Japan recorded its second consecutive trade deficit in August, according to the Finance Ministry’s report on Wednesday. The trade deficit stood at 695 billion yen ($4.9 billion), representing a 26% decrease from the same month last year. Despite this, sluggish consumer spending weighed on imports, contributing to the ongoing deficit.
Exports reached 8.4 trillion yen ($59 billion), a 5.6% increase from the previous year, with a rise in shipments to Asia, though exports to the U.S. declined. Imports, on the other hand, totaled 9.1 trillion yen ($64 billion), up 2.3% from the previous year. Strongest import growth was seen from European nations, particularly in categories like pharmaceuticals. Both export and import figures, however, fell short of forecasts, which had anticipated 10% growth for exports and even higher for imports.
The recent appreciation of the Japanese yen against the U.S. dollar has improved Japan’s purchasing power, with the exchange rate dropping from over 150 yen to about 140 yen per dollar in recent weeks. This currency shift has had mixed impacts on trade, as it makes imports cheaper but also affects the competitiveness of exports.
