Posted on 17 Jun 2015
Japan posted a 216 billion yen ($1.75 billion) trade deficit in May, a dramatic fall from a year earlier due to a drop in energy imports, but still not enough to offset lackluster shipments overseas, official data showed Wednesday.
The gap between imports and exports was down about 76% from a 917.2 billion yen deficit a year earlier.
The value of the country’s imports declined 8.7% in May, while exports rose a weaker-than-expected 2.4%.
But there was still concern about the health of the Japanese economy, particularly that weak demand overseas could dent factory output as manufacturers try to cut an inventory buildup that boosted growth in the first quarter.
“The trade deficit narrowed… in May, but should creep higher in the second half of the year as the weaker yen pushes up import costs,” Marcel Thieliant from Capital Economics said in a commentary.
A 1% expansion in the world’s number three economy between January and March—or 3.9% on an annualised basis—was sharply up from an initial estimate of 0.6% growth.
