“Yen Suffers as Japan Announces Trade Deficit”
The Japanese Yen suffered in Asian trading this morning as Japan announced its first annual trade deficit in over 30 years. The Yen was down against most major currencies as the finance ministry declared a 2.49 trillion yen deficit for 2011. Imports increased by 12% whilst exports declined 2.7% from 2010 as the earthquake and tsunami of March hit Japanese exports hard and forced increased imports of energy supplies to counterbalance the Fukushima atomic power plant being taken offline. Up from 2010 figures; Crude Oil imports increased by 21.3%, natural gas imports increased by 37.5% whilst petrochemical imports rose 39.5%
On the back of the worse than expected news coming from Japan; the Euro strengthened against the Yen, with the EUR/JPY up 0.236%, trading at 101.49 and the greenback also strengthened against the Yen, up 0.358% trading at 77.95.
The future for the Yen does not look healthy either, with the BoJ cutting its 2012 fiscal growth forecast down from 2.2% growth to 2.0% and predictions being made for a trade deficit until 2014 at least.
The debt crisis in the Eurozone continued to worsen with Greece and its creditors failing to agree on debt restructuring terms and the EUR/USD was down 0.031% trading at 1.3032 as the dollar firmed in volatile markets. The Cable (GBP/USD) was also down, falling 0.122%, trading at 1.5607.
In commodity news, there was heavy trading in crude oil as a strengthened USD helped keep a check on oil prices after earlier hitting a high of $100.19. Further saber rattling in Iran helped push the price of Crude oil up 0.15%, trading at $99.09 a barrel.
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