, Japan

Japan's yawning trade deficit stokes recession fears

October trade deficit reached 549bn yen.

BBVA reports that this data taken together with the 3Q GDP contraction is starting to cause concerns over a possible Japanese recession.

Here's more from BBVA:

Japan posted a trade deficit of 549bn yen (USD $6.7bn) in October (consensus: -360bn yen), adding to concerns that Japan’s economy may be entering a recession (Japan’s third quarter GDP showed a contraction of -3.5% saar).

For October, Japan's total exports declined by -6.5% y/y (consensus: -4.9% y/y), its fifth straight monthly decline, as shipments to China (Japan's biggest export market) slumped by -11.6% y/y, and exports to Europe declined for a 13th straight month, by -20.1% y/y.

Imports, meanwhile, decreased by less than exports (-1.6% y/y for the month), resulting in the large monthly deficit. The yen finished the day lower (by -0.6%) against the USD, at 82.17/USD, as speculation grows that the Bank of Japan will ease further in December in order to support the economy.

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