Japan's current account surplus down 54.5% in April

TOKYO, June 8 Kyodo - Japan's current account surplus shrank 54.5 percent in April from a year
earlier, while signs are emerging to suggest the pace of decline in exports has
become moderate, the Finance Ministry said Monday.
The surplus in the current account, the broadest gauge of Japan's trade with
the rest of the world, totaled 630.5 billion yen, the ministry said in a
preliminary report. The trade gauge fell for the 14th straight month.
The surplus in merchandise trade dropped 69.2 percent to 184.3 billion yen from
a year before, although it narrowed at the slowest pace since July last year.
The trade surplus continued for the third straight month as a decline in
exports abated after dropping a record 50.4 percent in February and 46.5
percent in March.
In April, exports fell 40.6 percent to 3,915.1 billion yen, while shipments of
automobiles and steel products remained particularly slack. Imports decreased
37.8 percent, the same margin as March, to 3,730.8 billion yen, down for the
sixth straight month.
''The tempo of decline in exports is expected to slow in the coming months as
many Japanese manufacturers are benefiting from rising overseas demand, backed
by stimulus measures,'' said Norio Miyagawa, senior economist at the Shinko
Research Institute.
He said exports may start expanding on a year-to-year basis around the end of
this year.
But imports will probably not recover as quickly as exports, said Miyagawa,
amid continued weak domestic demand, affected by sharp cuts in salaries in many
companies.
The balance of trade in goods and services posted a deficit of 287.3 billion
yen, the first red ink in three months due to an expansion of the deficit in
the service account, including payments in transport and tourism.
The deficit in the service account grew 19.9 percent to 471.7 billion yen,
partly because fewer overseas tourists visited Japan in the period, while more
Japanese people were traveling abroad amid the strengthening of the yen's value
versus other major currencies, ministry officials said.
The income surplus fell 18.5 percent to 1,056.7 billion yen as money earned
overseas through securities and bonds fell amid the economic downturn. The
surplus narrowed for the seventh straight month.
The current account balance is the difference between a country's income from
foreign sources and foreign obligations payable, excluding net capital
investment.
==Kyodo