Japan’s Ministry of Finance reported in its preliminary July trade statistics that import value reached a record monthly high and the trade deficit widened to ¥634.5 billion. Exports also hit a record high for the month, while the trade surplus with the US contracted sharply.
According to the preliminary July trade statistics, import value reached a record monthly high and the trade deficit stood at ¥634.5 billion. The deficit widened to more than three times the level a year earlier, marking the third consecutive month of deficits. Export value also reached a record high for July, but rising import costs for energy and electronic components weighed on the overall balance.
Exports rose 23.2% year on year to ¥11.5118 trillion, supported by a sharp increase in semiconductor-related electronic components and growth in automobile exports. Imports increased 27.8% to ¥12.1463 trillion on surging crude oil and electronic component costs, rising for the sixth consecutive month and reaching a record high for a single month. By region, exports to the US hit a record high, as did imports from the US.
Crude oil imports from the US surged 1,489.2%, while imports of liquefied natural gas also rose 54.5%. The trade surplus with the US contracted sharply to ¥280.4 billion, down approximately 50.7% year on year. Developments involving China, the EU and Asia were also reported.
Energy costs and supply chain pressures pushed up import value, while the resilience of exports has drawn market attention as a support for the economy. Views have been reported that energy price trends and the yen exchange rate will affect Japan’s trade balance going forward.