Japan reported a trade deficit in January, the highest in 8 years, while imports continue to rise.
Japan’s Finance Ministry reported a trade deficit of 2.19 trillion yen ($19 Billion), the sixth in a row and the largest since January 2014.
Total imports rose 39.6% year-on-year to 8.52 trillion yen, reaching a record high for the third consecutive month since data were collected in January 1979.
The factor driving up Japan’s import costs is the rising price of crude oil, coal, and liquefied natural gas, including the yen’s depreciation against the dollar.
The increase in imports exceeded that of exports, which rose by 9.6% to 6.33 trillion yen, due to rising prices for export goods such as steel and diesel.
The Japanese Cabinet Office reported that orders for basic machinery (excluding machinery for the shipbuilding industry and power utilities) increased by 3.6% in December compared with the previous month. As a result, the Japanese government raised its forecast for the expansion of machinery purchases.
Orders for basic machinery totaled 9.324 billion yen ($8.1 billion) in December, following a 3.4% increase in November.
Japan has raised its growth forecast for the second month in a row, officials said. Orders for machinery, an indicator of how companies are spending money, “are rising,” and in November it said orders “showed an increase”.
Looking at individual sectors, manufacturers’ machinery orders rose 8% to 4.798 billion yen, following a 12.9% increase in November, with equipment orders increasing in December, mainly used by manufacturers of non-ferrous metals and electrical machinery in nuclear reactors.
Non-manufacturing orders fell 0.1% to 4.654 billion yen due to orders from data services, including finance and insurance.
Foreign orders fell by 3.5% in December after rising by 0.7% in November.
For 2021 as a whole, orders for basic machinery rose 6.8% to 10.2 trillion yen, the first increase in three years following an 8.4% decline in 2020.