TOKYO (AP) — Japan racked up a trade deficit of 2.2 trillion yen ($19 billion) last month, an eight-year high, as the cost of energy imports soared, a the government announced on Thursday.
The Ministry of Finance said exports edged up 9.6% in January from the same month a year earlier. Imports jumped 39.6%, resulting in the sixth consecutive month of trade deficits, he said.
The amount is the largest since January 2014, when the trade deficit stood at nearly 2.8 trillion yen.
Koya Miyamae, senior economist at SMBC Nikko Securities, said the trade deficit tended to widen in January due to the New Year holidays, which drags down exports.
“But even taking that into account, the deficit is huge,” he said.
Japan imports almost all of its oil and gas. Prices recently hit multi-year highs, adding to global concerns about inflation. Tensions in Ukraine amid fears of a Russian invasion pushed prices even higher.
Meanwhile, Japan’s currency, the yen, has weakened against the US dollar as the Federal Reserve prepares to raise interest rates to counter inflation. Higher rates tend to push the dollar higher against other currencies, as they create greater demand for dollar-denominated investments.
Exports did not grow as quickly as imports as manufacturing of electronics and automobiles was slowed by shortages of computer chips resulting from pandemic-related disruptions in some countries.
Yuri Kageyama is on Twitter https://twitter.com/yurikageyama
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