Japanese exports rise as yen weakens

Japanese exports rose in May by the most since 2010 as the yen weakened, providing a boost to Prime Minister Shinzo Abe‘s plan to revive the economy. Shipments shot up 10.1% from the previous year, data showed, rising for a third straight month.

The yen has weakened significantly since last year, despite recent gains, helping exporters. A strong yen makes their goods expensive overseas and cuts profits. “We can certainly say that exports are headed in the right direction,” said Shuji Tonouchi from Mitsubishi UFJ Morgan Stanley Securities. “The breakdown shows that export volumes are still a little weak. Demand from the United States is doing well.”

Shipments picked up in key markets with exports to the US rising 16.3% from a year earlier. Shipments to China increased 8.3%. However, imports kept pace rising by 10% in May from a year ago, data showed. Therefore, the trade balance came to a deficit of $10.4 billion.

It marks the 11th straight month that Japan has posted a deficit as energy import costs continue to be high after nuclear plants were shut down.

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