Japan Feburary current account surplus rises, misses estimates

Japan’s current account extended its surplus to a 13th straight month in February, Ministry of Finance data showed on Monday, thanks to the trade deficit narrowing from the previous month. The surplus rose to 2.64 trillion yen ($17.41 billion) last month, but was below the median forecast for 3.11 trillion yen in a Reuters poll. It followed a 457 billion yen surplus in January and was the highest since October last year.

A breakdown of the data showed exports expanded by 5.5% year-on-year in February, driven by demand for cars, car parts and plastics. Imports grew by 1.4%, the first increase in 11 months, reflecting stronger demand for clothing, computer equipment and petroleum products. Primary income gains, or returns from past direct investment and portfolio investment overseas, saw Japan log a primary income surplus of 3.3069 trillion yen.

Bank of Japan Governor Kazuo Ueda said on Monday that making the central bank’s monetary policy framework simpler and easier to understand was among goals he had in mind when taking the bank’s helm in April last year. “When I assumed my post a year ago, I felt the BOJ’s policy framework had become a technically difficult one due to various reasons. If economic conditions allowed, I had hoped to make the framework simpler and easier to understand,” Ueda said.

“Thankfully, the economy was in fairly good shape in the previous fiscal year (that ended March), so I was able to fulfil my mission,” he told parliament.

Earlier, the Bank of Japan said on Thursday it bought 5.95 trillion yen ($40.6 billion) of Japanese government bonds (JGBs) in January, its lowest since June last year. The BOJ conducts bond buying operations regularly to contain sharp moves in JGB yields.