Japan’s exports and imports grow as yen weakens

TOKYO: Japan recorded a trade deficit in June, according to government data released Wednesday, as the higher price of oil imports helped cause the second straight month of red ink.

Japan’s trade deficit totalled 406.9 billion yen ($2.5 billion) in June, the Ministry of Finance reported, a reversal from the 122 billion yen surplus recorded a year ago.

Japan’s exports rose 19% from a year ago to 10.9 trillion yen, growing at a brisk pace, including semiconductor shipments. Japan’s exports grew to various nations, including the US and China. Imports gained 25% to 11.3 trillion yen.

A weak yen also helped drive both exports and imports higher. That’s because their value is usually priced in dollars.

The dollar has been trading at about 163 yen, up from 140-yen levels a year earlier.

Japan imports virtually all its oil. Before the war with Iran, much of it had passed through the Strait of Hormuz. Vessel traffic there has been severely disrupted.

Wednesday’s provisional ministry data show that Japan’s oil imports from the US surged nearly fivefold from a year ago.

Brent crude, which had been trading at about $60 a barrel at the beginning of this year, shot up to as high as $114 a barrel before gradually declining. Brent has been trading at $90 levels lately.

From January through June, Japan’s exports added nearly 14% to 60.6 trillion yen, while imports edged up nearly 11% to 61.9 trillion yen. That translates to about a trillion yen deficit.

The Japanese government under Prime Minister Sanae Takaichi, the nation’s first woman leader, has been turning to aggressive programs to jumpstart the economy, with spending in AI, defence and robotics. Recent polls show her popularity with voters, which had been high, is waning.

By RSS/AP