Welcome!

News Feed Item

FXPRIMUS Market Brief of the Week: Japan's Widening Trade Deficit Fueled the Expectation on a More Aggressive Easing

SINGAPORE, SINGAPORE -- (Marketwired) -- 04/23/14 -- In FXPRIMUS' Market Brief of The Week for 21 April, the brokerage firm's Senior Economist, Jimmy Zhu, looks at how Japan's Widening Trade Deficit Fueled the Expectation on a More Aggressive Easing.

Economic Insights

Japan March exports only rose by 1.8%, as Yen had been outperformed

Japan's Ministry of Finance reported today that the trade deficit for March came in at 1.45 trillion Yen. The figure is higher than the 1.08 trillion Yen median estimate of 28 economists surveyed by Bloomberg.


The cause of the huge deficit was two-fold:
  1) Exports rose just by 1.8 percent in March
  2) Imports surged by 18.1 percent in March

This was Japan's weakest export growth in a year. However, the bigger concern was Japan's ballooning imports. There were two main reasons which led to the bigger than expected import figure. Firstly, the weak Yen. The Yen dropped 19 % against the dollar since December 2012 as import values boosted significantly. This caused a surge in energy costs amidst several nuclear shutdowns within the country.

Secondly, the sales tax. On 1st April, Prime Minister Shinzo Abe raised the sales tax from 5 % to 8 %, the first increase in 17 years. The days leading up to the sales tax had caused a spending spree that boosted demands for foreign goods. Nationwide departmental store sales reported a 25.4 % jump in March from the previous year - the biggest gain since 1991.

Compared to March last year, the deficit had widened even further - to the tune of 366.9 billion Yen. All this is not good news for Abe. Ever since he came into power, he was intensely focused on weakening the Yen, both to fight deflation and boost export sales.

However, results have not shown marked improvement. In fact, the Yen's 19 % drop against the USD since December 2012 has failed to spark exports, and has contributed to 21 straight monthly deficits by boosting import values - the longest slide in comparable data back to 1979.

The bad news doesn't end there. Japan's consumer confidence fell in March for a fourth straight month to 37.5, down from 45.7 in May last year. Sliding consumer confidence indicates domestic demand might have weakened, while slowing export growth suggests external demand may fail to provide much support for an economy set to contract this quarter.

This is perhaps the most telling indicator of where Japan's economy is heading: the government cut its view of the economy in April, the first lowering of its assessment since November 2012. A lower evaluation of imports was one factor cited by a government official for the downgrade.

This begs the question - how optimistic can we be on Japan's future if even the government lowers its own economic assessment?


Top News This Week

Canada: Core Retail Sales m/m. Wednesday, 23rd April, 8.30pm.
I expect figures to come in at 0.6% (previous figure was 1.0%).

New Zealand: Official Cash Rate. Thursday, 24th April, 5am.
I expect figures to come in at 3% (previous figure was 2.75%).

ABOUT FXPRIMUS

FXPRIMUS offers retail traders a level of trade execution, service quality and fund safety that are normally reserved only for the largest investors. Serving traders in 205 countries across 6 continents FXPRIMUS combines an unmatched level of fund safety with regular independent audits of company financials and Straight Through Processing, top notch execution with tight spreads, prompt and responsive customer support, ISO 27001 certification in Information Security, ISO 9001:2008 certification in Quality Management and an industry-leading trader toolset that includes free access to powerful trader tools. FXPRIMUS truly is The Safest Place To Trade.

Add to Digg Bookmark with del.icio.us Add to Newsvine

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
"This week we're really focusing on scalability, asset preservation and how do you back up to the cloud and in the cloud with object storage, which is really a new way of attacking dealing with your file, your blocked data, where you put it and how you access it," stated Jeff Greenwald, Senior Director of Market Development at HGST, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
DevOps is being widely accepted (if not fully adopted) as essential in enterprise IT. But as Enterprise DevOps gains maturity, expands scope, and increases velocity, the need for data-driven decisions across teams becomes more acute. DevOps teams in any modern business must wrangle the ‘digital exhaust’ from the delivery toolchain, "pervasive" and "cognitive" computing, APIs and services, mobile devices and applications, the Internet of Things, and now even blockchain. In this power panel at @...
SYS-CON Events announced today that Catchpoint Systems, Inc., a provider of innovative web and infrastructure monitoring solutions, has been named “Silver Sponsor” of SYS-CON's DevOps Summit at 18th Cloud Expo New York, which will take place June 7-9, 2016, at the Javits Center in New York City, NY. Catchpoint is a leading Digital Performance Analytics company that provides unparalleled insight into customer-critical services to help consistently deliver an amazing customer experience. Designed ...
WebRTC services have already permeated corporate communications in the form of videoconferencing solutions. However, WebRTC has the potential of going beyond and catalyzing a new class of services providing more than calls with capabilities such as mass-scale real-time media broadcasting, enriched and augmented video, person-to-machine and machine-to-machine communications. In his session at @ThingsExpo, Luis Lopez, CEO of Kurento, introduced the technologies required for implementing these idea...
Buzzword alert: Microservices and IoT at a DevOps conference? What could possibly go wrong? In this Power Panel at DevOps Summit, moderated by Jason Bloomberg, the leading expert on architecting agility for the enterprise and president of Intellyx, panelists peeled away the buzz and discuss the important architectural principles behind implementing IoT solutions for the enterprise. As remote IoT devices and sensors become increasingly intelligent, they become part of our distributed cloud enviro...
"A lot of times people will come to us and have a very diverse set of requirements or very customized need and we'll help them to implement it in a fashion that you can't just buy off of the shelf," explained Nick Rose, CTO of Enzu, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
Containers have changed the mind of IT in DevOps. They enable developers to work with dev, test, stage and production environments identically. Containers provide the right abstraction for microservices and many cloud platforms have integrated them into deployment pipelines. DevOps and containers together help companies achieve their business goals faster and more effectively. In his session at DevOps Summit, Ruslan Synytsky, CEO and Co-founder of Jelastic, reviewed the current landscape of Dev...
The WebRTC Summit New York, to be held June 6-8, 2017, at the Javits Center in New York City, NY, announces that its Call for Papers is now open. Topics include all aspects of improving IT delivery by eliminating waste through automated business models leveraging cloud technologies. WebRTC Summit is co-located with 20th International Cloud Expo and @ThingsExpo. WebRTC is the future of browser-to-browser communications, and continues to make inroads into the traditional, difficult, plug-in web co...
In his keynote at @ThingsExpo, Chris Matthieu, Director of IoT Engineering at Citrix and co-founder and CTO of Octoblu, focused on building an IoT platform and company. He provided a behind-the-scenes look at Octoblu’s platform, business, and pivots along the way (including the Citrix acquisition of Octoblu).
For basic one-to-one voice or video calling solutions, WebRTC has proven to be a very powerful technology. Although WebRTC’s core functionality is to provide secure, real-time p2p media streaming, leveraging native platform features and server-side components brings up new communication capabilities for web and native mobile applications, allowing for advanced multi-user use cases such as video broadcasting, conferencing, and media recording.
SYS-CON Events announced today that Enzu will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY, and the 21st International Cloud Expo®, which will take place October 31-November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Enzu’s mission is to be the leading provider of enterprise cloud solutions worldwide. Enzu enables online businesses to use its IT infrastructure to their competitive ad...
"Plutora provides release and testing environment capabilities to the enterprise," explained Dalibor Siroky, Director and Co-founder of Plutora, in this SYS-CON.tv interview at @DevOpsSummit, held June 9-11, 2015, at the Javits Center in New York City.
DevOps tends to focus on the relationship between Dev and Ops, putting an emphasis on the ops and application infrastructure. But that’s changing with microservices architectures. In her session at DevOps Summit, Lori MacVittie, Evangelist for F5 Networks, will focus on how microservices are changing the underlying architectures needed to scale, secure and deliver applications based on highly distributed (micro) services and why that means an expansion into “the network” for DevOps.
"We are an all-flash array storage provider but our focus has been on VM-aware storage specifically for virtualized applications," stated Dhiraj Sehgal of Tintri in this SYS-CON.tv interview at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Choosing the right cloud for your workloads is a balancing act that can cost your organization time, money and aggravation - unless you get it right the first time. Economics, speed, performance, accessibility, administrative needs and security all play a vital role in dictating your approach to the cloud. Without knowing the right questions to ask, you could wind up paying for capacity you'll never need or underestimating the resources required to run your applications.