Yen not weak enough for exporters - BBH

By FXstreet.com | Updated August 20, 2014 AAA

FXStreet (Guatemala) - Marc Chandler, Global Head of Currency Strategy at Brown Brothers Harriman noted Japan’s trade deficit worsened in July.



Key Quotes:



"Japan’s trade deficit worsened in July, though higher imports could have been due to seasonal effects. The trade account posted ¥964.0 bln deficit vs. expected at ¥713.9 bln yen deficits."



"On a seasonally adjusted basis, it’s deficits slightly decreased to ¥1023.8 bln yen from ¥1067.8 bln yen in June. Exports rose 3.9% y/y, supported by a rise in export prices on a yen basis, while export volume expanded 0.9% y/y."



"The weaker yen helped exporter’s net profit but has still not contributed to expanding the market share of Japanese products in global markets. The biggest shock was imports rising 2.3% y/y vs. expected at -1.5% y/y."



"But this is likely due to a higher oil price which is up 6.9%. Imports remain stagnant, falling 0.4% y/y due to weak private consumption after the sales tax hike."



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