Japan's trade deficit declines in 6 months as exports recover

TOKYO

Japan posted a trade surplus in June, the first in three months, highlighting a recovery in exports, government data showed Thursday.

For the first six months of this year, Japan’s trade deficit declined by more than half from the same period last year, to 3.23 trillion yen ($21 billion), according to Finance Ministry data.

The yen’s weakness against the U.S. dollar has helped boost Japan’s exports in recent months. The trade surplus in June grew five-fold from a year earlier to 224 billion yen, or $1.4 billion, on rising exports of vehicles and computer chips.

The weak yen works as a negative for Japan’s imports, especially amid inflationary trends and rising energy costs. Resource-poor Japan imports almost all its energy.

Japan has logged trade deficits for six straight fiscal half-years, starting with the final half of 2021, mainly because of the weak yen and rising global prices. Japan's fiscal year runs from April to March.

For the month of June, imports rose 3 percent to 8.98 trillion yen ($58 billion), while exports rose 5% to 9.2 trillion yen ($59 billion).

In the first six months of the year, imports rose 0.8 percent to 54.7 trillion yen ($350 billion), while exports gained nearly 9 percent to 51.5 trillion yen ($330 billion).

A report by economists at SMBC Nikko Securities, including Koya Miyamae, projects Japan’s trade deficit will continue to decline. Exports to the U.S. and Asia rose, those to Europe are lagging, they said.