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According to Japan’s Ministry of Finance, Japan’s Merchandise Trade Balance contracted by much more than expected, sinking to ¥-231.2 billion compared to the expected ¥-41.2 billion. The USD/JPY is seeing limited reaction to the figures out of the gate, trading into 110.55.

Key highlights

The prior trade balance was ¥720.8 billion.

The adjusted trade balance also missed and printed in contraction, coming in at ¥-45.6 billion versus the expected ¥20.7 billion surplus.

Exports sank to 3.9% y/y compared to the forecast 6.3%; previous was 6.7%.

Imports surged to 14.6% y/y, last was 2.6%.

Exports to the US declined in July by 5.2% y/y, while exports to China lifted 11.9% y/y.