Japan's Current Account Surplus Expands for Two Consecutive Months... 76-Month Streak of Surplus Continues

October Surplus Increased by 15.7% Compared to Same Period Last Year

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] Despite the impact of the novel coronavirus infection (COVID-19), Japan's current account surplus in October expanded for the second consecutive month, NHK and others reported on the 8th.

According to the report, the Japanese Ministry of Finance announced in its October balance of payments (preliminary) data that Japan's current account surplus in October recorded 2.1447 trillion yen (approximately 223.6 trillion won), an increase of 15.7% compared to the same period last year. This marks Japan's current account surplus continuing for 76 consecutive months (6 years and 4 months).

The trade balance, a major component of the current account, recorded a surplus of 971.1 billion yen. Exports were tallied at 6.3198 trillion yen, down 3.2% from the same period last year, but imports decreased by 15.2% to 5.3488 trillion yen, resulting in an expanded trade surplus.

The services balance, which includes the travel balance, recorded a deficit of 384.6 billion yen due to a significant decrease in foreign visitors to Japan caused by COVID-19 related entry and exit restrictions. The travel balance remained at a surplus of 23.5 billion yen. The primary income balance, reflecting interest and dividend income from overseas investments, saw its October surplus decrease by 2.6% compared to the same month last year.

Along with this, the Japanese government revised upward its real Gross Domestic Product (GDP) forecast for the third quarter (July to September). According to the revised forecast announced by the Cabinet Office, the annual GDP growth rate is expected to reach 22.9%. This is 1.5 percentage points higher than the preliminary figure (21.4%).

The Japanese government analyzed that, despite the COVID-19 situation, economic activities gradually resumed, overcoming the shocking negative growth of the previous quarter (April to June), achieving positive growth for the first time in four quarters.

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