Japan Current Account Surplus Doubles from Last Year

apan’s current account surplus for April doubled from a year before, marking the third consecutive monthly gain, as an increase in direct investment income outweighed a trade deficit, government data showed Monday.

The surplus in the balance, one of the widest gauges of international trade, stood at 750.0 billion yen, up 376.5 billion yen from a year earlier, the Finance Ministry said in a preliminary report.

The income account, which reflects how much Japan earns from its foreign investments, marked a record high monthly surplus of 2.12 trillion yen, up 51.8 percent, helped by a rise in dividends and profits Japanese firms gained from their overseas units.

A weaker yen generally boosts the value of Japanese investors’ overseas investment gains in yen terms. The Japanese currency has significantly weakened against other currencies, particularly under the aggressive monetary easing policy pursued by the government of Prime Minister Shinzo Abe.

The goods trade deficit expanded for the eighth straight month to 818.8 billion yen, the highest level for April since 1985 as growing imports more than offset a rise in exports.

via Mainichi

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza