Japan's Current Account Surplus Widens, Helped by Weak Yen, Oilby
Influx of tourists from overseas aided in better trade picture
Data indicates companies are continuing to accumulate wealth
Japan’s current account was a surplus in September for a 15th consecutive month as low oil prices and a weak yen helped boost income from overseas.
Japan had a 1.5 trillion yen ($11.9 billion) excess in its broadest measure of trade, the finance ministry said Tuesday. The result was narrower than a median estimate of a 2.15 trillion yen surplus in a Bloomberg survey of economists.
An influx of tourists from overseas combined with the weaker yen and low energy import bill is improving Japan’s trade picture. The strength in the current account indicates that companies are continuing to accumulate wealth, which could be used for more investment and wage increases to help an economy that has struggled to gain momentum.
“The current account is likely to continue a rising trend,” Shinichiro Kobayashi, an economist at Mitsubishi UFJ Research and Consulting Co., said before the report was released. “It’s positive for the economy. Japanese companies are making money abroad and Japanese merchants are benefiting from an increasing number of foreign tourists. ”
Income gains that include earnings from foreign direct investment have been a key factor in the current account surplus as a weak yen helps boost profits abroad when repatriated. The yen traded at 123.07 per dollar as of 8:54 a.m. in Tokyo, after weakening 8.5 percent in the year through September.
The number of foreign visitors coming to Japan rose 47 percent from a year earlier in September to 1.61 million, according to the Japan National Tourism Organization.