Japan's June Trade Surplus Fell 26% Amid Weaker Yen
March 31, 2011
The Finance Ministry said the trade surplus totaled 737.11 billion yen ($6.78 billion) in June, down 26% from 989.57 billion yen a year earlier. Economists, who had expected a surplus of 500 billion yen, blamed the yen's drop for the discrepancy, noting that the currency was 27% weaker against the dollar in June than it was a year earlier. The pace of decline in the surplus is ``losing steam because of the yen's depreciation over the past year,'' said Petrina Mozell, economist at James Capel Pacific Ltd.. Japan's politically sensitive trade surplus with the U.S. narrowed to 296.11 billion yen in June, from 360.76 billion yen a year earlier, while its overall surplus with Asia dropped 9.9% to 578.2 billion yen. For the first half, the trade surplus narrowed to 3.111 trillion yen, from 5.196 trillion yen in the year-earlier period. The figure marks the sixth straight decline for a six-month period. Japan's surplus in global trade, long a source of tension with many countries, has been steadily shrinking for the past 18 months, but June's trade data has raised concern that the narrowing trend may be coming to an end. Still, the drop in June's surplus was the 19th consecutive month of year-to-year declines. Last year, Japan's trade surplus fell below 1994's level, marking the first annual decline in five years. A ministry official briefing reporters said the government expects the declining trend in the trade surplus to continue on strong import momentum. The trade figures are measured as goods clear customs but before adjustment for seasonal factors. In April, the ministry began reporting the trade data in yen terms only, rather than in both yen and dollar terms.
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