Japan Logged ¥1.37-Trillion Trade Deficit Last Month

Japan's trade deficit in May shrank 42% percent from a year earlier to 1.37 trillion yen ($9.8 billion), due largely to a decline in fuel import costs, with slowing export growth casting a pall over the economy, government data showed, Kyodo News reported.

Photo Insert: US-bound shipments of cars and machinery supported Japan's total exports.

Imports stood at 8.67 trillion yen, down 9.9%, while exports grew 0.6 percent to 7.29 trillion yen, a record for May, amid a weak yen. Japan remained in the red for the 22nd straight month, highlighting the resource-scarce nation's reliance on imports.

US-bound shipments of cars and machinery supported Japan's total exports, even as those of equipment and electronic components required to manufacture semiconductors declined, the Finance Ministry said.

Crude oil, coal, and liquefied natural gas imports fell, a year after their sharp increases in value terms helped widen the country's trade deficit amid supply concerns triggered by Russia's war in Ukraine.

Aggressive monetary tightening in the US and Europe has raised concerns about a global economic slowdown.

The US dollar was 4.8% higher against the yen than in May 2022, reflecting the diverging monetary policy paths of the Federal Reserve and the Bank of Japan.

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