Poll Japan August trade deficit seen at 9-year high as weak yen boosts imports

Poll Japan August trade deficit seen at 9-year high as weak yen boosts imports
Poll Japan August trade deficit seen at 9-year high as weak yen boosts imports

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TOKYO, Sept 9 (Reuters) – Japan likely recorded its biggest trade deficit in more than nine years in August as the yen pushed its import spending to a 24-year low, a Reuters poll showed on Friday.

The yen’s sharp decline prompted fresh verbal warnings from Japanese policymakers this week, after economists said the currency’s devaluation could push Japan’s core inflation to around 3% by the end of the year, eroding household purchasing power. Read more

The August trade balance likely ended at a deficit of 2.398 trillion yen ($16.80 billion) as a 46.7% increase in imports outpaced a 23.6% increase in exports, the median estimate of economists in the survey showed.

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The expected shortfall would mark the largest monthly record since a 2.790 trillion yen deficit in January 2014.

“While crude oil price growth has stalled since July, the yen’s decline has pushed up import costs,” said Kenta Sua, an economist at Mizuho Research and Technologies.

The world’s third-largest economy grew an annualized 3.5% in April-June on firm household and business spending to ease Covid-19 restrictions, revised gross domestic product data showed on Thursday. Read more

But analysts are not optimistic for Japan’s growth outlook amid risks to inflation and weak global economic demand.

Other data due next week is likely to show Japan’s annual wholesale inflation reached 8.9% in August, re-accelerating from 8.6% in July, a sign firms are facing relentless price pressures that are squeezing profits, the poll showed.

Core machinery orders, a key indicator of business spending, were expected to fall 0.8% month-on-month in July after rising 0.9% in June, the poll also showed.

The government will release trade figures at 8:50 a.m. on September 15 (2350 GMT, September 14) and machinery orders data at 8:50 a.m. on September 14 (2350 GMT, September 13).

The Bank of Japan will release wholesale rate data at 8:50 a.m. on September 13 (2350 GMT, September 12).

($1 = 142.7700 yen)

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Reporting by Kantaro Komiya; Editing by Kim Coghill

Our standards: Thomson Reuters Trust Policy.

The article is in Bengali

Tags: Poll Japan August trade deficit #9year high weak yen boosts imports

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