The Spokesman-Review Newspaper
The Spokesman-Review Newspaper The Spokesman-Review
Spokane, Washington  Est. May 19, 1883
Current Temperature
39°F
Current Conditions
Overcast clouds
View complete weather report

Color Scheme

Subscribe now

Powerful Yen Boosts Japan’s Trade Surplus Gap With U.S. Widened 8.6 Percent In May

Associated Press

The yen’s rapid rise contributed to a 7.1 percent increase in Japan’s trade surplus in dollar terms in May from the same month last year, the Finance Ministry announced Thursday.

The surplus, which rose to $6.98 billion from $6.52 billion a year earlier, was the first increase in three months.

Japan’s politically sensitive trade surplus with the United States, meanwhile, rose 8.6 percent, its seventh consecutive monthly increase. The surplus rose to $3.30 billion from $3.04 billion a year earlier.

The ministry attributed the sudden jump in the overall surplus to the 23 percent rise in the value of the yen against the dollar from the previous May.

It also described May 1994 as a freak month, when the surplus slipped by 16 percent because of abnormal shipping results.

In yen terms, the surplus shrank for the sixth straight month, falling 12 percent to 591.07 billion yen from 674.33 billion yen.

The United States has hoped that a stronger yen will bring down Japan’s trade surplus by making Japanese exports more expensive and American products cheaper to buy in Japan.

But so far, export and import volumes haven’t shifted enough to make up for the difference in exchange rates. U.S. demand for Japanese products has remained strong despite higher dollar prices, and Japan’s weak domestic economy has restrained consumption increases.

Still, overall imports surged 32 percent in May from a year earlier to $28.52 billion from $21.60 billion, the ministry said. Exports rose 26 percent to $35.50 billion from $28.12 billion.

The increase in exports was led by a 17 percent rise, in volume, in semiconductors and other electronics parts shipments.

Exports of motor vehicles to the United States fell 2.8 percent in volume in May.

Japanese luxury cars may face 100 percent tariffs worth $5.9 billion dollars on June 28, retroactive to May 20, if Washington carries out a threat over an auto trade dispute. The ministry said the threat didn’t result in any rush of exports to the United States in May.