Japan Faces Continued Trade Deficit Amid Currency Shifts and Import Pressures

Japan experienced a trade deficit for the second consecutive month in August, with a total of 695 billion yen. While exports increased by 5.6%, imports grew by 2.3%, with the strongest growth seen in pharmaceuticals from Europe. The yen's value increase against the dollar improved purchasing power.

Japan witnessed a trade deficit for the second consecutive month in August, the Finance Ministry reported on Wednesday, amid sluggish consumer spending impacting imports.

Japan's trade deficit amounted to 695 billion yen (USD 4.9 billion), reflecting a 26% decrease from the previous year. Exports reached 8.4 trillion yen, a 5.6% increase from August of the previous year, driven mainly by shipments to Asia. However, exports to the US experienced a decline.

Overall imports were 9.1 trillion yen, a 2.3% increase, with notable growth in pharmaceutical imports from Europe. Despite the yen appreciating against the US dollar recently, the numbers fell short of growth forecasts of 10% for exports and even higher for imports.

(With inputs from agencies.)