Japan’s Surplus Expands to $21 Billion in August

Japan’s current account surplus expanded to 2.38 trillion yen ($21 billion) in August, the highest on record for the month, lifted by income from foreign investments and a bigger trade surplus, government data showed Tuesday.

The surplus in the primary income account, which reflects how much Japan earns from foreign investments, rose 13.0 percent from a year ago to 2.24 trillion yen, the Finance Ministry said in a preliminary report.

Japan ran a current account surplus for the 38th straight month in August. The yen’s depreciation against the dollar was one of the factors boosting income from foreign investment, a ministry official said.

“Japanese companies are stepping up overseas investment and the yen is relatively soft (against the dollar)…in that situation, primary income tends to get a boost,” said Hidenobu Tokuda, senior economist at the Mizuho Research Institute.

The dollar averaged 109.91 yen in August, higher than 101.27 yen a year ago, while the euro traded at 129.84 yen, up from 113.54 yen.

Among other key components in the current account, goods trade registered a surplus of 318.7 billion yen, up 46.2 percent.

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