Japan posted a current account surplus of ¥1.35 trillion ($12 billion) in November on robust earnings from foreign investments, marking the 41st straight month of black ink, government data showed Friday.
But the surplus shrank 5.6 percent from a year ago as trade-reliant Japan had a smaller trade surplus of ¥181.0 billion in November due to a surge in imports. It marked the first year-on-year drop in five months, the Finance Ministry said in a preliminary report.
Imports gained by a greater margin than exports, up 17.6 percent from a year ago to ¥6.59 trillion amid swelling energy imports in value.
Increased shipments of semiconductor-related equipment and cars lifted the country’s exports by 13.9 percent to ¥6.77 trillion.
Largely due to hefty foreign investment income, Japan’s current account surplus is one of the widest gauges of international trade.
The surplus in the primary income account, which reflects how much the country earns from foreign investments, expanded 10.4 percent to ¥1.33 trillion, helped by the yen’s depreciation against the dollar and the euro.
“For the past few months, rising crude oil prices have had a strong bearing on the current account balance so if they continue to rise, they could weigh on the trade surplus,” said Yuichiro Nagai, an economist at Barclays Securities Japan Ltd.
Crude oil imports jumped 28.4 percent in value as crude oil prices averaged $57.68 a barrel in November.
U.S. crude oil futures continued their upswing on the New York market Thursday amid supply concerns, briefly hitting a more than three-year high above $64 per barrel.
“Both exports and primary income are expected to remain solid, helping the current account surplus stay at relatively high levels. But we need to watch developments in the currency and bond markets as well,” Nagai added.
The data showed the travel surplus hit a record high for November, nearly doubling from a year ago to ¥148.5 billion as Japan continued to see an increase in the number of foreign visitors.
The service balance, which also includes passenger transportation and royalties, stood at a smaller surplus than a year ago of ¥41.7 billion.