Japan ran into its biggest trade deficit in a single month in eight years in January amid high energy costs and strained global supply chain contains which caused a decline in automobile shipments.
The trade deficit underscores the country’s soaring commodity costs as well as slowing demand from China as China itself is struggling to keep up momentum.
Import costs soaring as high as 39.6% in January which in terms of yen reached around 8.5231 trillion yen, according data from the Ministry of Finance.
The imports figure outstripped a 9.6% rise in exports in the year to January, bringing trade deficit balance at 2.1911 trillion yen. It the biggest in a single month since January 2014.
The deficit was much bigger than the median estimate for a 1.607 trillion yen shortfall.
“Exports tend to go down in January due to seasonal factors as factory operation rates are usually low due to New Year holidays,” said Takumi Tsunoda, senior economist at Shinkin Central Bank Research Institute, told Reuters.
“So it’s easy for the trade balance to go in the red in the month, but the deficit was still large, even when taking that into account.”
