Japan’s trade balance deficit continues to exceed forecasts, as the yen rises

Last month, Japan’s trade balance deficit decreased less than it was expected. The impact of a weaker yen has extended to the country’s imports. Even lower commodity prices couldn’t help to correct this deficit.

The finance ministry’s data released on Thursday, December 15, showed that the country’s trade deficit has already exceeded 2 trillion yen ($14.8 billion) for a third of the year. In November, the actual deficit was 2.03 trillion yen, which is significantly higher than economists’ forecasts of 1.68 trillion.

Compared to the previous year, Japan’s imports increased by 30.3% and exports by 20%. The first figure exceeded economists’ expectations and rose mostly due to crude oil and coal supplies. The second figure, in turn, was in line with predictions. The rise in exports was majorly provided by auto production, as well as by construction and mining machinery.

Japan’s trade balance has been in deficit for more than a year, and by the end of 2022 might reach its record lows. The country’s economy has suffered significantly from a negative net trade performance, bolstered by the weak yen and low commodity costs.