Japan Posts Second Consecutive Current Account Deficit; 2012 Account Surplus Lowest on R

IMG Auteur
Published : February 11th, 2013
523 words - Reading time : 1 - 2 minutes
( 0 vote, 0/5 )
Print article
  Article Comments Comment this article Rating All Articles  
0
Send
0
comment
Our Newsletter...
Category : Crisis Watch

Bloomberg reports Japan Posts Back-to-Back Current-Account Deficit in December.

Japan posted back-to-back monthly current-account deficits for the first time since 1981, highlighting challenges for Prime Minister Shinzo Abe’s campaign to revive the economy.

The shortfall in the widest measure of the nation’s trade was 264.1 billion yen ($2.8 billion) in December, the Ministry of Finance said in Tokyo today. The median estimate of 23 economists surveyed by Bloomberg News was for a deficit of 144.2 billion yen.

Weakness in global demand, a spat with China and increased energy imports because of nuclear plant shutdowns are weighing on the world’s third-biggest economy as Abe pushes the Bank of Japan to end deflation and spur growth.

China Dispute

Exports to China in 2012 fell 10.8 percent from 2011, as slower Chinese growth and a territorial dispute affected a merchandise trade relationship worth 26.5 trillion yen in 2012, according to ministry data.

BOJ Governor Masaaki Shirakawa said Feb. 6 he would step down on March 19, almost three weeks before the end of his term, accelerating a leadership transition that may boost Abe’s campaign for aggressive easing.
Record Low Surplus for 2012

Reuters reports Record low current account surplus shows Japan's challenges
Japan posted its smallest annual current account surplus on record in 2012 as exports weakened and energy imports grew, a signal to Prime Minister Shinzo Abe that economic revival needs more than just a weaker yen and extra spending.

The current account surplus is likely to continue shrinking as energy imports rise due to the closure of nuclear power plants and as Japanese exporters lose out to more competitive Asian rivals, economists say.

Japan's current account surplus was 4.7 trillion yen ($50.4 billion) in 2012, Ministry of Finance data showed, a figure that seems impressive. But it was less than half the surplus recorded a year earlier and the smallest since 1985, when Japan started compiling comparable data.

The deterioration was most marked at the end of the year, with Japan posting consecutive monthly deficits for the first time as the December shortfall hit 264.1 billion yen, more than 80 percent bigger than the median forecast in a Reuters poll.

"Energy imports and higher energy costs are structural factors that will cause the current account surplus to decline further," said Hiroshi Miyazaki, chief economist at Shinkin Asset Management Co.

"Currency moves can only go so far in improving corporate competitiveness. There are other areas like corporate taxes or incentives for business investment where Japan is lagging."

Data last month showed Japan posted a record trade deficit of 6.9 trillion yen in 2012, as exports fell in annual terms through the second half of the year.

The theory is that a weaker yen will reignite the export engine in coming months, but that assumes there will be demand -- something Japan's once-dominant electronic makers are struggling with.
As I have said, this is a case of be careful of what you wish, because you may get it. Inflation is not going to do Japan any good at all in my estimation. Japan's demographics and energy imports make the situation much worse.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Data and Statistics for these countries : China | Japan | All
Gold and Silver Prices for these countries : China | Japan | All
<< Previous article
Rate : Average note :0 (0 vote)
>> Next article
IMG Auteur
Mish 13 abonnés
Mike Shedlock / Mish is a registered investment advisor representative for SitkaPacific Capital Management. He writes a global economics blog which has commentary 5-7 times a week. He also writes for the Daily Reckoning, Whiskey & Gunpowder, and has over 80 magazine and book cover credits. Visit http://www.sitkapacific.com
WebsiteSubscribe to his services
Comments closed
Latest comment posted for this article
Be the first to comment
Add your comment
Top articles
Latest Comments
Who Moved My Xanax?
17 JanThemis-1
I actually agree with a lot of what Trump says while deploring the tone and his lack of judgment in making such remarks publically while in office.
Socialist Dystopia: Starving Venezuelans Loot As Runaway Inflation ...
17 JanThemis
There is a 19th century English word that is particularly appropriate in this instance - "kakistocracy", i.e. government by the worst or least qual...
Who Moved My Xanax?
15 JanMr. Gnawbone
It is an exploitation of the ignorant and uninformed population, but that is what happens when they pay attention to meaningless information and ...
Racism-O-Rama
15 JanMr. Gnawbone1
It sounds racist, so it has to be. Overton Bubble at work, the faculty were programed to respond as if to a Pavlovian Bell. There is no way to ch...
Racism-O-Rama
16 Jandennyc1
Ah, yes, black welfare recipients receiving our hard earned and easily spent tax dollars and providing us nothing save their lives for our investme...
Racism-O-Rama
15 JanDoom2
It's not just the English that is considered RACIST, it's also mathematics, and a wide range of other things: http://professorconfess.blogspot...
2018: The Wrong Lesson on Gold Investing
14 JanThe Recusant
As you say, it's only what the central banks do that matters. Gold and its little brother silver are the only true measures of fiat currencies and ...
One-year score card for Trump
13 JanS W.
Everything else aside, Donald Trump has a very small mouth, combined with the weirdest lip action and pouting of any person I have ever seen.
Most commented articlesFavoritesMore...
World PM Newsflow
ALL
GOLD
SILVER
PGM & DIAMONDS
OIL & GAS
OTHER METALS
Take advantage of rising gold stocks
  • Subscribe to our weekly mining market briefing.
  • Receive our research reports on junior mining companies
    with the strongest potential
  • Free service, your email is safe
  • Limited offer, register now !
Go to website.