Bloomberg: Yen May Decline Versus Dollar on View Japan’s October Trade Surplus Shrank

Nov. 24 (Bloomberg) — The yen may drop for the first day
this week against the dollar in Asia on speculation a report
today will show Japan’s trade surplus shrank in October.

The trade surplus probably contracted by almost a quarter
last month as rising crude oil prices increased

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

“The 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 118.75 at 8:20 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 140.25 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, probably fell 24 percent to 878.9 billion yen ($7.4
billion) from a year earlier, according to the median forecast
of 32 economists surveyed by Bloomberg News. Imports are
expected to gain 18.5 percent, they said. The Ministry of
Finance is scheduled to release the report at 8:50 a.m.

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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