Japan’s current account surplus for January dropped from a year earlier for the first decline in five months, as the travel surplus continued to plunge amid the novel coronavirus pandemic, government data showed Monday.
The current account balance, one of the widest gauges of international trade, registered a surplus of ¥646.8 billion ($6 billion), down 2.3% from a year ago to mark the 79th straight month of black ink, the Finance Ministry said in a preliminary report.
The services trade balance logged a deficit of ¥480.9 billion, more than tripling from the previous year’s deficit of ¥142.2 billion, as the travel surplus continued to see a significant fall due to strict travel restrictions by countries attempting to contain the virus spread.
The travel balance shows the amount of money spent by visitors from overseas in Japan against the spending of Japanese travelers abroad. It logged a ¥25.0 billion surplus in January, down 91.6% from ¥296.2 billion a year earlier.
The surplus in primary income, which reflects returns on overseas investments, also plunged 22.1% from the previous year to ¥1.47 trillion.
A ministry official told reporters that a decrease in returns on bond investments due to lower interest rates globally as well as a drop in sales for Japanese firms’ overseas subsidiaries contributed to the outcome.
Meanwhile, the country’s goods trade balance improved to a deficit of ¥130.1 billion, shrinking 86.9% from a ¥990.4 billion deficit the previous year, but the January figure marked the first red ink in seven months.
Exports grew 2.7% from the previous year to ¥5.69 trillion for the second monthly rise. They were supported by brisk demand for semiconductor production equipment from South Korea and plastic from China, the official said.
The relatively solid performance came despite a second state of emergency over the virus declared earlier that month for the Tokyo metropolitan area that was later expanded to other parts of the country.
Imports declined 10.9% to ¥5.82 trillion for the 21st consecutive month of decrease, on falling crude oil prices and drops in demand for clothing from China.
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