Current account surplus logs first expansion in 13 months

The nation’s surplus in the broadest measure of trade logged a year-on-year expansion for the first time in 13 months in February, reflecting a surge in exports, the Finance Ministry said Tuesday.

The surplus in the current account, which measures not only trade in goods and services but also investment flows and cash transfers, rose 33.3 percent compared with the same period last year to 1.47 trillion yen, according to preliminary figures.

But the February figures should not be taken as a sign of a shift in the yearlong shrinking trend of the current account surplus, a ministry official said.

The underlying factors behind the trend, including Japan’s recovering economy, higher oil prices and a stronger yen, have not changed, the official added.

Improved domestic demand can increase the volume of imports, thus helping reduce the trade surplus.

The surplus in merchandise trade — exports minus imports — rose 19.4 percent to 1.3 trillion yen, making it the biggest component of the current-account balance.

Total exports increased 13.9 percent year-on-year, compared with a meager 0.9 percent rise registered the previous month. Exports to the rest of Asia were especially brisk, because of a rebound from a year earlier, when exports to the region hit bottom.

Imports meanwhile advanced 11.4 percent, partly because of higher oil prices. Crude oil prices on a yen basis soared 111.8 percent to an average of 17.442 yen per kiloliter.

The yen averaged 109.34 to the dollar in the month, stronger than 116.66 a year earlier. A stronger yen can be a factor that makes Japanese exports more expensive abroad and cuts the price of imports.

The service deficit shrank to 354.1 billion yen, down 122.9 billion yen, partly because of a large amount of royalties received, which the official said was a temporary factor.

As a result, the surplus in goods and services trade totaled 947 billion yen, up 54.6 percent from a year earlier.

The income account, which includes income from Japanese investment in foreign securities, left a surplus of 590 billion yen, up 27.4 percent.