Japan’s current account surplus in April plunged 84.2 percent from a year earlier as exports and spending by foreign visitors nosedived due to the coronavirus pandemic, government data showed Monday.
The current account, one of the widest gauges of international trade, was ¥262.7 billion in the black, the 70th straight month of surplus but the smallest total since January 2017, according to a preliminary report released by the Finance Ministry.
Exports dropped 23.0 percent to ¥4.91 trillion as demand for cars and auto parts from the United States fell due to the coronavirus lockdown.
Imports were down 9.5 percent to ¥5.88 trillion on the back of falling prices for crude oil and other energy items.
That led to a goods trade deficit of ¥966.5 billion, the first red ink in three months.
Japan’s travel balance, which reflects the amount of money foreign visitors use in the country versus how much Japanese spend abroad, came to a surplus of ¥22.5 billion, down 91.8 percent from a year earlier as it imposed strict travel restrictions to prevent an influx of infections.
Services trade came to a deficit of ¥630.2 billion, the first red ink in two months.
A ministry official who briefed reporters said the goods trade balance and the travel balance were expected to remain under pressure, at least until May when the nationwide state of emergency — imposed in April — was lifted and economic activity slowly began resuming.
Japan’s surplus in primary income fell 7.7 percent to ¥1.98 trillion on a drop in the value of its overseas portfolio investments.
The coronavirus pandemic has dealt a heavy blow to the world’s third-largest economy, which was already on shaky ground following a consumption tax hike from 8 percent to 10 percent last October.
Gross domestic product shrank an annualized real 2.2 percent in the January to March quarter, the Cabinet Office said Monday, an upward revision but confirming Japan has entered a recession — defined as two successive quarters of contraction — following a 7.2 percent slump in the previous three months.