Japan’s trade surplus hit the lowest level on record ($7.74 billion) last fiscal year ended in March, Bloomberg reports. The sharpest decline was logged in the total value of goods and services trade, which was partially offset by the growth in income generated by the Japanese abroad.
One of the factors responsible for the decrease is the yen depreciation against the greenback. In early 2013, the U.S. dollar strengthened versus the Japanese currency by 15%. Owing to that, the energy imports accounting for the lion’s share of all the imported goods rose in value.
In early 2014, Japan’s trade balance continued to worsen. In January, the deficit hovered one-month low, while it contracted 10 times compared to last year.
In the meantime, the government debt of this Asian country keeps growing. By the end of 2013, the debt exceeded ¥1 quadrillion (or $10 trillion). Such a figure has not affected the government bonds yields yet as the biggest part of the debt is inside the country. However, in case Japan continues trading with the rest of the world with such a deficit, the interest rates will be upgraded inevitably.
