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Japan exports fall, trade deficit persists

Japan exports fall, trade deficit persists

Japan’s exports fell more than economists forecast and the nation’s trade deficit persisted for the eighth straight month, underscoring challenges to Prime Minister Shinzo Abe’s campaign to revive the world’s third-biggest economy.

Shipments dropped 2.9 percent in February from a year earlier, the Finance Ministry said in Tokyo Thursday, while imports rose 11.9 percent, resulting in a deficit of 777.5 billion yen ($8 billion) for the month.

With upper-house elections only months away, Abe needs to show that his economic policies are gaining traction. While the benefits for exporters from a weaker yen may be yet to kick in, declines in the currency are swelling the nation’s import bill.

Extra easing by the Bank of Japan is “likely to weaken the yen, boosting import costs and expanding the trade deficit,” Junko Nishioka, chief economist at RBS Securities Japan Ltd. in Tokyo and a former central bank official, said before the release. “The positive impact of the declining yen has yet to be seen.”

Updated : 2021-05-09 16:41 GMT+08:00