TOKYO: Japan fell into a trade deficit in May, the first since January, the finance ministry said Monday, as renewed yen strength pressured exports. Japanese exports fell for all major regions, including the nation’s biggest trading partner China, as concerns linger over a slowdown in the largest Asian economy as well as other emerging markets.
The government of Prime Minister Shinzo Abe has actively attempted to talk down the yen’s strength, with ministers repeatedly suggesting that Tokyo could step into the market to weaken the currency, as they rush to safeguard the fragile economy ahead of a July parliamentary election.
A rising yen dents Japanese exports by making the country’s products more expensive in overseas markets and thus less competitive. The currency, often seen as a safe haven, has broadly gained in recent months, partially on fears over the state of the global economy and more recently on concerns over a possible British exit from the European Union in a referendum this week.
Abe was also preparing to launch further stimulus, as his controversial big-spending and easy money policy blitz, known as “Abenomics”, has failed to pull Japan out of its prolonged economic malaise more than three years after the programmes began.
