Japan's June current account deficit hits 5-month high

FILE PHOTO - A cargo ship and containers are seen at an industrial port in Tokyo.

TOKYO Japan ran a current account deficit for the first time in five months in June, as surging imports exceeded exports, the data showed on Monday, highlighting the pressure that higher energy and raw material prices are putting on the economy.

The world's third-largest economy ran a current account deficit of 132.4 billion yen $980 million in June, a decline of 872 billion yen from the same month a year ago, according to government data.

The data, which marked the first monthly deficit since January, was smaller than economists' median forecast for a 703.8 billion shortfall in a Reuters poll.

High prices for energy sources like oil and coal drove the value of imports to a record, rising 49% year-on-year and outpacing a 20% increase in the value of exports, led by mineral fuels and steel.

The country earns hefty returns from its investment overseas and portfolio investments, which are offset by deficits in its trade balance, as the data shows the change in Japan's economic structure.

The current account surplus has declined four fiscal years in a row through March 2022, a fourth year in a row.

The yen's weakness has inflated the cost of imports, but its boost to the value of exports has not been as great as it once was due to the shifting of exporters' production abroad.