The Japanese economy has recorded a relatively noticeable trade deficit during the start of the current year which is considered to be the first since 23 months, due to a considerable yet not high decrease in export rates, where the export rates increased by 2.9% and imports increased by 15.6%.
Elaborating more on the current trade deficit that occurred in January, The Japanese Economy released today data on the total current account, total adjusted current account and the Trade balance during the month of January. The actual reading of the total current account showed a value of 461.9 billion yen compared to the previous reading of 1,195.3 billion yen forecasted to be 470.0 billion yen.
Where as the actual reading of the total adjusted current account came out at 1,089.2 billion yen compared to the previous reading of 1,555.9 billion yen revised to 1,518.6 billion yen forecasted to be 1,167.0 billion yen. The actual reading of the Trade balance showed a deficit 394.5 billion yen compared to the previous surplus reading of 768.8 billion yen forecasted to show a deficit of 371.8 billion yen.
It is worth mentioning that the decrease in exports is mainly related to the holiday celebrations of the lunar New Year in both China and South Korea, backed up with financial analysts stating that trade surplus will gain it is strength after this occasion. It is also believed that the GDP will also gain it is strength during this quarter after the drop in export rates has caused an economical contraction.
One of the main importers of Japanese products is the US, there fore it is also worth mentioning that the Jobless rates in the US has dropped by 8.9% during February which is considered to be the lowest in two years, where the American companies has added 192,000 new jobs supporting the growing confidence of the American economical recovery, which one way or another could have affected the Japanese export rates.
Taking a glimpse at the Chinese economy, the Chinese economy is experiencing high inflation rates which negatively affect the Chinese standard of living, which enforce the Chinese government to hike interest rate twice this current year which could cool down the GDP rate during the first half of the year.
Since China is considered to be the largest trading partner to Japan; any drop in the Chinese demand will have a negative impact on the Japanese export rates.
The unstable economical and political conditions in the Middle East caused considerable fluctuations oil prices, which might have a negative affect on the Japanese exports
Ecpulse
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