By Kantaro Komiya

TOKYO, Reuters – Japanese imports rose in May at their fastest rate in six months. This was due to a surge in raw materials prices and the yen’s fall to its lowest level in two decades, according to Reuters poll.

Japanese consumers and businesses that focus on domestic markets are suffering from increasing import costs. This raises questions about central bank’s belief that weak yens can be beneficial for the economy.

The value of imports rose by 43.6% between a year ago and May, which was the largest increase in one month since November. This is in addition to the acceleration from April’s 28.2% rise, according to a poll of 17 economists.

According to Takumi Takumi, Shinkin Central Bank Research Institute senior economist, “Rising oil prices combined with a falling Japanese yen increased imports.”

The record-breaking rise in import goods prices based on Yen was recorded by Bank of Japan data Friday.

According to the poll, exports likely increased 16.4% in May, which is slightly more than April’s 12.5% increase.

However, the bigger increase in imports is forecast to raise the May trade deficit by 2.022 trillion Japanese yen ($15.08 Billion), which would be close to the biggest one-month gap in 8 years.

Tsunoda explained that the primary reason behind an increase in trade gaps would be exports. These could have grown more quickly. He also said that shipping of cars and other goods to manufacturing plants likely experienced supply disruptions as a result of China’s COVID-19 locksdowns.

According to the poll, core machinery orders, an indicator of capital expenditures, are expected to fall 1.5% per month in April, after increasing 7.1% in March.

On June 16, the government will publish trade data at 8 :50 AM (2350 GMT June 15), and machinery orders data at 8.50 AM on June 15, (2350 GMT June 14).

($1 = 134.0800 yen)