Japan posted a current account surplus for the 10th consecutive month in April, as declining crude oil prices pushed down imports and the weaker yen boosted income from abroad.
The surplus stood at ¥1.326 trillion ($10.56 billion), the largest in five years for the reporting month, the Finance Ministry said in the preliminary report.
Exports rose 4.1 percent to ¥6.229 billion on the strength of the U.S. and other overseas economies. Imports dropped 5.9 percent to ¥6.375 billion, shrinking the goods trade deficit by ¥643.4 billion from a year earlier to ¥146.2 billion.
Imports of crude oil plunged 34.6 percent in April, as average oil declined 48.8 percent from a year earlier to $56.09 per barrel during the month.
Japan remains heavily dependent on energy imports in the wake of the nuclear disaster at Tokyo Electric Power Co.’s Fukushima No. 1 plant. With the public concerned about the safety of atomic power, all of the country’s 43 viable commercial reactors remain offline.
The surplus in the primary income account, which reflects how much Japan earns from its foreign investments, expanded 19.1 percent to ¥2.197 billion, with a weaker yen helping raise receipts of overseas securities investment.
The service sector, including passenger transportation and cargo shipping, logged a deficit of ¥524.5 billion, but the amount was smaller than the previous year.
“The primary income account and service balance are likely to continue improving, leading to a further increase in the current account surplus,” said Yuichiro Nagai, an economist at Barclays Securities Japan Ltd.
As lower crude oil prices are expected to keep pushing down import values for a while, the size of the current account surplus is likely to double from the ¥7.8 trillion logged the previous year, by the end of fiscal 2015 next March, he added.
The yen’s decline also helped lured foreign tourists to Japan, bringing the travel balance to a surplus of ¥133.4 billion, the highest since comparable data became available in 1996.
A surplus in the travel balance “is increasing as a trend because of the weakening yen and the government’s tourism strategy, including easing visa regulations and expanding duty exemptions,” a ministry official said.
The yen fell 16.6 percent against the dollar year-on-year in the reporting month, to an average ¥119.55.
A falling yen usually supports exports by making Japanese products cheaper abroad and bolstering the value of overseas revenues in yen terms when repatriated.