Tokyo: Japan posted a USD 1.75 billion trade deficit in May, a dramatic fall from a year earlier due to a drop in energy imports, but still not enough to offset lacklustre shipments overseas, official data showed Wednesday.
The gap between imports and exports came in at 216.0 billion yen ($1.75 billion), down about 76 percent from a 917.2 billion yen deficit a year earlier.
The value of the country`s imports declined 8.7 percent in May, while exports rose a weaker-than-expected 2.4 percent.
But there was still concern about the health of the Japanese economy, particularly that weak demand overseas could dent factory output as manufacturers try to cut an inventory buildup that boosted growth in the first quarter.
"The trade deficit narrowed... in May, but should creep higher in the second half of the year as the weaker yen pushes up import costs," Marcel Thieliant from Capital Economics said in a commentary.
A 1.0 percent expansion in the world`s number three economy between January and March -- or 3.9 percent on an annualised basis -- was sharply up from an initial estimate of 0.6 percent growth.
