The nation’s current account surplus — the broadest gauge of trade in goods and services — fell 24.4 percent in April to 877.6 billion yen compared with the previous year, marking its fifth consecutive month in decline, the Finance Ministry said Wednesday in a preliminary report.
The shrinking trade surplus during the month amid a slowdown in the global economy was a primary factor in the drop, a ministry official said.
The decrease for April was the largest since the 59.7 percent plunge in January. But the official said it is difficult to determine whether five declining months in a row constitutes a trend for the current account surplus, as various factors are involved.
The current account measures the difference between a country’s income from foreign sources and foreign obligations payable, excluding net capital investment.
The surplus in merchandise trade — exports minus imports — fell 35 percent from a year earlier to 837.2 billion yen in April. Exports dropped 2.1 percent on the same basis to 4.11 trillion yen, while imports rose 12.4 percent to 3.27 trillion yen.
Exports of automobiles posted a 5.1 percent year-on-year drop in April and those of electronic parts such as semiconductors were down 7 percent.
This is due to shrinking global demand stemming from the U.S. economic slowdown, the official said.
In contrast, the value of imports soared in April because of the yen’s depreciation, the official said.
The yen averaged 123.83 to the dollar during the month, which is a 17.4 percent depreciation from the same month last year.
Affected by foreign exchange, crude oil prices in April rose 11.1 percent from a year before to 20,182 yen per kiloliter, marking the 24th straight month of year-on-year increase.
The deficit in the services account also contributed to April’s 24.4 percent drop in the current account surplus. The deficit expanded by 120.3 billion yen to 640.9 billion yen due to an increase in the payment of patent loyalties to foreign companies, the official said.
The surplus in the trade and services account thus contracted for seven months in a row, logging a 74.4 percent decline from a year earlier to 196.3 billion yen.
Meanwhile, the surplus in the income balance expanded by 260.7 billion yen to 748.6 billion yen in April due mainly to an increase in securities investment returns.
The deficit in current account transfers shrank by 27.2 billion yen from the same month last year to 67.3 billion yen, according to the figures.
As a result, the surplus in the current account, which combines these accounts, posted a 24.4 percent decline to 877.6 billion yen in April.
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