Japanese exports fall on strong yen and euro troubles
- 21 December 2011
- From the section Business
Japanese exports have fallen again as demand for the country's goods continues to suffer.
Overseas shipments fell 4.5% in November from a year earlier, Ministry of Finance data showed.
The strength of the Japanese yen as well as the ongoing European debt crisis have weighed on external demand.
Meanwhile the Bank of Japan has decided to keep its key interest rate on hold at between zero and 0.1%.
Japan's economy recovered from a recession that was sparked by the devastating tsunami and earthquake in March.
However in recent months the boost from recovering supply chains and restored production facilities has started to diminish.
Japanese exports came in at 5.2 trillion yen ($66.8bn; £42.6bn) in November, falling for the second straight month.
Imports rose 11.4% to 5.88tn yen, the ministry said. That lead to an expansion in the trade balance deficit to 684.7bn yen.
Analysts said adding to the problems was the effect of the weakness in the global economy.
"The adverse effect of the slowdown in Europe through a drop in Europe-bound exports and possible spillover onto demand in Asia has begun to emerge," said Naoki Iizuka from Mizuho Securities in Tokyo.
Battling the yen
The other challenge that the global economic uncertainty brings is that investors are turning to the yen as a safer investment.
That has boosted the currency making Japanese exports more expensive overseas.
The problem is such a concern that the government has intervened in the currency markets to try and reduce the impact.
On Tuesday authorities said they will expand the funds available for more currency interventions in the future.