Current account surplus boosts outlook for Japan

JAPAN’S current account surplus fell by a smaller-than-expected 48.8 per cent in March from a year earlier, a sign that export demand may be stabilising after a slump in the wake of the financial crisis.

The country is enduring its worst recession since World War Two but exports and output have shown some signs of recovery, adding to hopes the global downturn may be nearing a bottom.

Japan logged a current account surplus for the second straight month in March, of 1.49 trillion yen (£10.2bn), after it sank to a record deficit in January, Ministry of Finance data showed.

“As overseas demand has bottomed out, the trade balance will recover moderately albeit at a low level,” said Junko Nishioka, chief Japan economist at RBS Securities.

“Japan will face fewer risks of a current account deficit.”