Japan logs record current account deficit «
TOKYO — Japan’s current account posted its largest deficit on record in November, as a weaker yen pushed up import costs but failed to give a strong enough boost to exporters.
The deficit in the current account stood at ¥592.8 billion ($5.75 billion) before seasonal adjustment, the Ministry of Finance said Tuesday. That is the biggest deficit on record since comparable data became available in 1985. The figure was much wider than the ¥380.0 billion deficit forecast by The Wall Street Journal and the Nikkei.
Bloomberg The account is calculated as the broadest balance of Japan’s trade in goods and services and investments with the rest of the world. The deficit is proof of a structural change in Japan’s position — from an export powerhouse to a net importer of goods.
Economists looking at the figures said the deficit reflected a rise in domestic demand as consumers seek to stock up on goods before higher prices come on stream in April due to a scheduled increase in the sales tax to 8% from the current 5%.
“Domestic demand has strengthened ahead of the sales tax hike, pushing up imports. This is likely to continue until March,” said Takeshi Minami, chief economist at Norinchukin Research Institute.
“Current accounts are likely to return to positive after March although we will likely continue to see trade deficits,” he added.