Japan Trade Gap Widens Sharply In May

Japan's trade deficit widened to JPY 203.4 billion in May 2017 from JPY 47.4 billion in the same month a year earlier while missing market expectations of a JPY 76 billion surplus. Imports jumped 17.8 percent from the previous year to JPY 6,054.7 billion, boosted by higher purchases of mineral fuels, electrical machinery, chemicals and machinery. Exports increased at a slower 14.9 percent to JPY 5,851.4 billion, due to higher shipments of transport equipment, machinery, manufactured goods and electrical machinery.

In May, imports jumped 17.8 percent from a year earlier to JPY 6,054.7 billion, faster than market expectations of a 14.8 percent gain. It was the strongest gain since early 2014, as purchases rose for most categories: Mineral fuels (41.5 percent), of which petroleum (8.7 percent); electrical machinery (11.5 percent); chemicals (16.6 percent); machinery (16.4 percent); others (8.8 percent), of which clothing (5.8 percent); foodstuff (11.9 percent); manufactured goods (14.6 percent); raw materials (25.7 percent). In contrast, imports of transport equipment fell 1.9 percent.

Among major trading partners, imports grew from China (9.6 percent), the US (7.4 percent), Australia (51.1 percent), South Korea (17.5 percent), Taiwan (11.1 percent), Germany (8.2 percent) and Thailand (25 percent).

Exports increased at a slower 14.9 percent to JPY 5,851.4 billion, below expectations of a 16.1 percent rise. Still, it was the sixth straight month of increase in exports and the fastest since January 2015 as sales rose mainly for transport equipment (12.5 percent) boosted by higher shipments of motor vehicles (8.2 percent). Also, exports went up for: Machinery (17.1 percent), boosted by power generating machine (20.9 percent) and semicon machinery (25.1 percent); manufactured goods (12.4 percent), led by iron and steel products (20 percent); electrical machinery (13.6 percent); chemicals (14 percent); others (25.8 percent), mainly boosted by scientific, optical instruments (24.8 percent). In contrast, outbound shipments of mineral fuels declined by 10 percent.

Among major trading partners, exports rose to China (23.9 percent), the US (11.6 percent), the EU (19.8 percent), South Korea (22.9 percent), Hong Kong (11.9 percent) and Thailand (16.3 percent). In contrast, sales dropped to Taiwan (-0.9 percent).

Ministry of Finance l Rida Husna | rida@tradingeconomics.com
6/19/2017 8:08:49 AM