- Hiroshi Watanabe, senior economist at SMBC Nikko Securities
Japan logged its 29th consecutive trade deficit in November despite a slight decline of imports due to the recent fall in crude oil prices. The unadjusted gap in trade widened to 891.9 billion in November from the October's revised 736.9 billion yen shortfall. The seasonally-adjusted trade deficit narrowed slightly to 925.0 billion yen from the revised 985.1 billion yen.
Japan's exports rose for a third consecutive month in November from the previous year, but much more slowly than projected and despite a sharp plunge in the Japanese Yen as weak demand in Asia and Europe dampened trade. Exports surged 4.9%, largely on shipments of electronic components, optical equipment and machinery, whereas volume was still down 1.7%. Japan's costs for oil imports plummeted 22% in November from a year earlier, lowering total imports by 1.7% from the previous year to 7.1 trillion yen, the first downturn in three months. Energy costs have weighed heavily on Japan as the resource-poor country struggles to plug a yawning energy abyss after the 2011 Fukushima disaster forced the shutdown of nuclear reactors, which once supplied more than a quarter of its power. The Japanese Yen's sharp fall has exacerbated the problem further, as it hiked the cost of imports purchased in foreign currencies. The Yen trades currently at the lowest level in seven years versus the US Dollar.
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