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Japanese Merchandise Trade Balance Deficit Widens as Industries Continue Facing Hardships

By David Liu
20 June 2011 01:20 GMT

A continued decline in Japanese exports confirms additional difficulties in rebuilding faced by Japanese industries after March’s Tohoku Earthquakes. The decline in exports may prompt support for additional rebuilding funding from the government, though the Bank of Japan has remained ambivalent towards providing more liquidity injections. Despite the fall in merchandise exports, a higher level of imports showed that Japan was still largely relying on trading partners for goods as its economy recovers.

EVENT

ACT

EXP

PREV

Merchandise Trade Balance Total (Yen) (MAY)

-¥853.7B

-¥710.1B

-¥464.8B

Adjusted Merchandise Trade Balance (Yen) (MAY)

-¥474.6B

-¥538.5B

-¥496.4B

Merchandise Trade Exports (YoY) (MAY)

-10.3

-8.4

-12.4

Merchandise Trade Imports (YoY) (MAY)

12.3

11.6

8.9

Japanese_Merchandise_Trade_Balance_Deficit_Widens_as_Industries_Continue_Facing_Hardships_body_Picture_5.png, Japanese Merchandise Trade Balance Deficit Widens as Industries Continue Facing Hardships

Japanese Merchandise Trade Balance. Chart generated with Bloomberg LP Professional Terminal.

The Japanese yen weakened against the US dollar immediately after the report as the growing deficit prompted investors to seek haven in the more liquid greenback. Despite the weaker Japanese data, attention still remains towards Europe for new developments as European finance ministers failed to agree on a comprehensive plan for Greek debt.

Japanese_Merchandise_Trade_Balance_Deficit_Widens_as_Industries_Continue_Facing_Hardships_body_Picture_6.png, Japanese Merchandise Trade Balance Deficit Widens as Industries Continue Facing Hardships

USDJPY 5 minute chart; vertical line indicates time of data release. Chart generated with FXCM Strategy Trader.

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20 June 2011 01:20 GMT