Japan: Hefty oil imports prompt trade deficit to widen in August
September 19, 2018
Nominal yen-denominated merchandise exports increased 6.6% annually in August, accelerating from July’s 3.9% expansion and overshooting market expectations of a 5.3% increase. Solid exports to China were behind August’s acceleration, while shipments to the United States continue to falter.
Import growth accelerated again in August, rising from 14.6% in July to 15.4% in August. The print was a six-month high and came in above the 14.9% increase that market analysts had expected. August’s sizeable expansion reflected strong crude oil imports.
The merchandise trade deficit widened from JPY 0.2 trillion in July to JPY 0.4 trillion in August (August 2017: JPY 0.1 trillion surplus). Meanwhile, the 12-month trailing trade surplus fell from JPY 1.9 trillion in July to JPY 1.3 trillion in August, marking the lowest reading in two years.