Bloomberg: Yen May Decline Versus Dollar as Report Shows Japan’s Trade Surplus Shrank

Nov. 24 (Bloomberg) — The yen may drop for the first day
this week against the dollar in Asia after a report today showed
Japan’s trade surplus shrank more than expected in October.

The surplus contracted by more than a quarter last month as
rising domestic demand spurred imports,

economists said. Higher
imports raise the amount of yen that must be exchanged for
foreign currencies.

“The more-than-expected decline in the trade surplus will
likely encourage yen-selling today,” said Toshiaki Kimura,
group manager of foreign exchange and financial products trading
in Tokyo at Mitsubishi UFJ Trust & Banking Corp, a unit of the
world’s largest lender by assets. “The trade-balance argument
is not supportive for the yen.”

Against the dollar, the yen traded at 118.77 at 9:04 a.m.
in Tokyo, from 118.73 late yesterday in New York, according to
EBS, an electronic currency dealing system. Against the euro, it
was at 140.21 from 140.35. The yen will move between 118.30 and
119.00 against the dollar and between 139.80 and 140.60 versus
the euro today, Kimura said.

Japan’s trade surplus, the amount by which exports exceed
imports, shrank 28.8 percent to 822.1 billion yen ($6.9 billion)
from a year earlier, compared with a median forecast of 878.9
billion yen of 32 economists surveyed by Bloomberg News. Exports
rose 8 percent from a year earlier and imports gained 17.8
percent.

Japan imports almost all its oil and is the world’s third-
largest user of crude, after the U.S. and China.

Trading may be less than usual because of the U.S.
Thanksgiving Day holiday.

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