“Japan’s economy recovered from its contraction at the start of the year.”
Japan’s exports have witnessed tremendous growth after the previous three months’ economic contraction. Exports have seen a sharp rise of 5.4%, followed by chip-making gear and non-ferrous metals. On the other hand, imports also rose to 3.2%, with an estimated 9.6% gain compared to last year, as indicated by analysts. With this smaller-than-expected rise in imports can create a balanced surplus of ¥224 billion ($1.4 billion) from a deficit of ¥1.22 trillion in May.
“I see a rebound in second-quarter GDP from the first quarter, but it will not be robust growth,”
- Yutaro Suzuki, an economist at Daiwa Securities.
This trade surplus difference supports Japan’s economy in tapping return growth from the last quarter. The Bank of Japan is mulling over the strength of the economy as it heads for the latest monetary policy decisions. By region, Japan’s shipment to the US has gained 11%, while the increase in exports to China is getting slower to the weakest pace in the past five quarters.
Japan policymakers are observing the impact of the weakened yen on the economy and prices ahead of the Bank of Japan’s next policy decision. Authorities in Japan needed to step into the foreign exchange market multiple times this year to shore up the yen, with last week’s moves showing the latest example of a two-punch intervention effort.
