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Japan's 2020 1st half current account surplus lowest in over 5 yrs

Update: August, 11/2020 - 11:30

TOKYO — Japan's current account surplus in the first half of 2020 fell to its lowest level in over five years as exports and spending by visitors from overseas were hit hard by the novel coronavirus pandemic, government data showed on Tuesday.

The figure on a half-yearly basis stood at 7.31 trillion yen (US$69 billion), the lowest since a 3.54 trillion yen surplus in the second half of 2014 when the trade deficit swelled due mainly to a surge in gas imports and a fall in the yen, according to a preliminary report released by the Finance Ministry.

The current account surplus, one of the widest gauges of international trade, was down 31.4 percent in the January-June period from a year earlier, the ministry said.

Among key components, the goods trade balance posted a 1.10 trillion yen deficit, turning negative for the first time in three half-year periods, with exports of cars and auto parts sharply down as the pandemic weighed heavily on overseas demand for such items.

Exports plunged 15.6 per cent from a year earlier to 32.01 trillion yen, while imports also dropped 12.3 per cent to 33.10 trillion yen.

Primary income, which reflects returns on overseas investments, helped the world's third-largest economy stay in the black on a half-year basis with a surplus of 10.43 trillion yen, down 4.0 percent from the previous year.

Services trade, which includes cargo shipping and passenger transportation, was 1.17 trillion yen in the red, the largest deficit since the latter half of 2014, amid strict international travel restrictions to curb the spread of the virus.

In June alone, Japan reported a current account surplus of 167.5 billion yen, marking the 72nd straight month of surplus.

The country had a goods trade deficit of 77.3 billion yen and a services trade deficit of 157.7 billion yen, both marking the third straight month of red ink. Primary income saw a surplus of 426.4 billion yen, down 5.8 per cent from a year earlier. — KYODO

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