Japan's May Current Account Surplus Down 27.9% YoY... 71 Consecutive Months of Surplus

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] Due to the impact of the novel coronavirus infection (COVID-19), Japan's current account surplus in May decreased by 27.9% compared to the same month last year. Compared to April, the decline narrowed, resulting in a current account surplus for 71 consecutive months.

According to NHK and others on the 8th, the Japanese Ministry of Finance reported in the preliminary balance of payments report for May that the current account recorded a surplus of 1.1768 trillion yen (approximately 13.1 trillion won). The size of the current account surplus in May this year decreased by 27.9% (454.3 billion yen) compared to May last year. However, considering that the surplus decline rate in April was 84.2%, the decrease has somewhat eased.

Regarding the trade balance, a major component of the current account, the deficit narrowed by 102 billion yen compared to the same period last year due to imports decreasing more than exports, resulting in a deficit of 556.8 billion yen. May exports were 4.1979 trillion yen, down 28.9% year-on-year, and imports were 4.7547 trillion yen, down 27.7%. Exports have declined for three consecutive months, and imports for 13 consecutive months.

The service balance in May turned to a deficit of 92.5 billion yen from a surplus of 15.24 billion yen in May last year, due to a sharp decrease in travel surplus caused by COVID-19. This marks two consecutive months of deficit. The number of foreign visitors to Japan in May was 1,700, a 99.9% decrease compared to the same period last year, which appears to have influenced this. The number of foreign visitors to Japan was the lowest since statistics began in 1964.

The primary income balance, which shows trends in interest and dividend income earned from overseas investments, recorded a surplus of 2.0434 trillion yen in May. The surplus narrowed as securities investment income from financial transactions investing in foreign stocks and bonds decreased. Foreign media reported that delayed dividend receipts from overseas subsidiaries due to the COVID-19 impact was another factor.

This content was produced with the assistance of AI translation services.