EDITOR'S NOTE: THIS EDIT CONTAINS CONVERTED 4:3 MATERIAL. A spring in his step after his G8 peers gave his policies the 'all clear' - another reason for Prime Minister Shinzo Abe to smile. The latest trade data shows Japan's exports jumped 10 percent in May from a year ago, the third straight month of gains. That's suggests Abe's push for a weaker yen, which is designed to make Japanese goods more competitive abroad, is working. And just in time, because investors are starting to lose faith in 'Abenomics' after a stock sell-off and volatile bonds. Even more encouraging is that exports to China and the U.S. - Japan's two biggest trade partners - are finally staging a comeback. (SOUNDBITE) (English) REUTERS REPORTER, YONGGI KANG, SAYING: "But Abe shouldn't get too comfortable just yet. Look at the trade figures closely and some troubling signs emerge." The world's third biggest economy posted a deficit in May of around 10 billion dollars - the third biggest ever, and the eleventh straight month in the red. This is where the weaker yen is backfiring, because it's made imports more expensive. Masayuki Kichikawa at Bank of America Merrill Lynch thinks stronger domestic demand for imports could result in Japan posting a bigger trade deficit this year than in 2012. (SOUNDBITE) (English) REUTERS REPORTER, YONGGI KANG, SAYING: "This deficit streak represents a huge change for an economy that posted trade surpluses for decades. Economists are split on the impacts, but some have linked deficits to unemployment and slower growth - which will make reflating Japan's economy that much harder. So we'll see so how long Abe will wear that smile." ENDS