Japanese trade deficit narrowed in September

Ministry of Finance (MOF) data released Thursday showed that Japanese imports rose more than 40% in September for the fifth consecutive month, reaching the highest level in history.

Increased imports led to a trade deficit of 2 trillion yen ($13.34 billion). This extended the period of the deficit to 14 months, which could increase pressure on the Japanese currency.

Finance Ministry data show Japan’s imports rose 45.9% in September from a year earlier, led by crude oil, liquefied natural gas and coal.

Exports increased by 28.9% year-on-year in September. This was driven by auto shipments to the US and demand for chips and electronic components from South Korea.

Exports to China, Japan’s largest trading partner, rose 17.1% year-on-year in September.

Shipments to the US rose 45.2% through September, led by auto shipments, construction equipment and mining.

Japanese authorities spent 2.8 trillion yen on intervention to sell dollars and buy yen to support the Japanese currency for the first time since 1998. The yen has weakened by about 20% against the dollar this year and has fallen to its lowest level in 32 years.

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