Japan posted a current account surplus of 287.1 billion yen in August for the second straight month of black ink despite a big trade deficit, as income from foreign investments surged to a record high for the month, the government said Wednesday.
Exports rose 1.0 percent from a year earlier to 5,649.2 billion yen amid growing shipments of metalworking machinery, but imports climbed 2.3 percent to 6,480.9 billion yen due in part to rising imports of liquefied natural gas, bringing the goods trade deficit to 831.8 billion yen, also a record high for the month, the Finance Ministry said.
The surplus in the primary income account, which reflects how much Japan earns from its foreign investments, jumped 20.6 percent to 1,519.9 billion yen, up for the second straight month, buoyed by dividends from foreign direct investment with the yen weakening, the ministry said in a preliminary report.
In August, the services sector, including passenger transportation and cargo shipping, posted a deficit of 250.8 billion yen, but the travel balance of payments improved as the number of foreign passenger arrivals in Japan soared 22.4 percent from a year before to 1.11 million, the largest for the month.
Japan’s current account surplus is expected to keep widening as the recent depreciation of the yen is set to push up profits from overseas investments, outweighing an expansion in fuel energy imports triggered by the suspension of nuclear power generation in the wake of the Fukushima emergency in March 2011, analysts said.
“The trade deficit is unlikely to narrow soon given weak exports, but the current account surplus may increase with the yen’s slide driving up the income account surplus,” said Yoshiki Shinke, chief economist at the Dai-ichi Life Research Institute.
via Mainichi
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