Japan's current-account surplus widened for a fifth month in December as demand from Asia helped exports advance for the first time in more than a year.
The surplus rose to 901 billion yen ($10 billion) from a year earlier, the Ministry of Finance said in Tokyo today. Exports rose 11.7 percent, the first advance in 15 months, while weak demand at home caused imports to fall 6 percent.
A surge in global trade helped the world's second-largest economy expand for a third quarter in the final three months of 2009, analysts estimate a report will show next week. Growth in Asia, which is bolstering sales at companies including Honda Motor Co., will keep fuelling Japan's surplus as long as gains in the yen remain contained, said economist Hiroshi Miyazaki.
"The report highlights the recent trend of a continuing rebound in exports," said Miyazaki, chief economist at Shinkin Asset Management Co. in Tokyo. "The American and Chinese economies are steadily recovering."
The yen traded at 89.32 per dollar at 12:31 p.m. in Tokyo from 89.30 before the report. Japan's currency has surged 4.2 percent this year, the only one of 10 major currencies to gain against the greenback, eroding the value of profits when they are repatriated to Japan.
The median estimate of 24 economists surveyed by Bloomberg was for the surplus to swell to 1.01 trillion yen.
Faster Growth
Japan's economy probably grew at an annual 3.8 percent pace in the three months ended December, faster than the 1.3 percent expansion in the previous quarter, according to the median estimate of 20 economists surveyed by Bloomberg. The Cabinet Office report is scheduled for release on February 15.
Honda is benefiting from Asian demand. Japan's second- largest carmaker last week said it expects to sell 950,000 vehicles in the region excluding Japan this fiscal year, up from the 910,000 it projected earlier. The company also raised its net income forecast for the same period to 265 billion yen from 155 billion yen.
Japan's shipments to China gained 42.8 percent in December, while exports to the US slid 7.6 percent and those to Europe advanced 1.4 percent, customs-cleared trade data showed last month. Today's figures don't include regional breakdowns.
The current account tracks the flow of goods, services and investment income between Japan and its trading partners. It includes trade not shown in the customs-cleared balance.
Lending Slump
The export recovery has yet to spur spending by companies and consumers at home. A Bank of Japan report today showed bank lending fell 1.7 percent in January from a year earlier, the biggest drop in more than four years, in part because of waning corporate demand for loans.
The lending report "just highlights how weak domestic demand is at this point," said Miyazaki at Shinkin Asset. "Capital spending at home is going to stay low, which in turn means bank lending won't rise."
On a seasonally adjusted basis, the current-account surplus narrowed to 1.101 trillion yen in December. Exports fell 0.2 percent from November, and imports climbed 1.5 percent.
The income surplus, the difference between money earned abroad and payments made to foreign investors in Japan, narrowed 34.7 percent to 474.8 billion yen in December from a year earlier, the ministry said. The gap shrank as the stronger yen reduced investors' profits and retained earnings at firms' overseas subsidiaries dwindled.
"The conditions are lining up for the income surplus to start widening," Miyazaki said. "If economies abroad are recovering, then investors' returns on overseas investments should increase as well."
Today's report also showed exports plunged 34.3 percent in 2009 and imports dropped 36.2 percent, both unprecedented retreats that highlighted last year's collapse in global trade. The income surplus slid a record 22.2 percent.
http://www.bloomberg.com/apps/news?pid=20601101&sid=asBTxUNcQLMc
|
