Japan Current Account Surplus Tops Estimates

Japan’s current account surplus rose to JPY 2,988.9 billion in July 2026 from JPY 2,586.3 billion in the same month a year earlier, exceeding market expectations for a JPY 2,870 billion surplus. The increase was supported by a larger primary income surplus, which climbed to JPY 4,289.6 billion from JPY 4,053.9 billion a year before, while the services deficit narrowed to JPY 512.9 billion from JPY 771.1 billion and the secondary income deficit shrank to JPY 387.9 billion from JPY 508.9 billion. Meanwhile, the goods deficit widened to JPY 399.9 billion from JPY 187.7 billion, as exports rose 24.1%, supported by strong demand for AI-related electronics, but imports grew faster at 25.9%, driven partly by higher crude oil purchases. In the first half of 2026, Japan recorded a JPY 17.43 trillion current account surplus, up from JPY 14.23 trillion in the same period a year earlier.

Japan’s current account swung to a deficit of JPY 92.3 billion in June 2026 from a surplus of JPY 1,281.8 billion a year earlier, falling well short of market expectations for a JPY 1,512 billion surplus. It marked the first deficit since January 2025, as the goods account shifted to a JPY 135.2 billion deficit from a JPY 467.3 billion surplus. Exports rose 16.3%, supported by strong demand for AI-related electronics, but lagged a 24.3% increase in imports, driven by higher crude oil purchases. The services deficit widened to JPY 228.5 billion from JPY 160.6 billion, while the primary income surplus fell sharply to JPY 380.1 billion from JPY 1,444.9 billion. In contrast, the secondary income deficit narrowed to JPY 108.6 billion from JPY 469.8 billion. Despite the monthly deficit, Japan recorded a JPY 17.43 trillion current account surplus in the first half of 2026, up from JPY 14.23 trillion in the same period a year earlier.

Japan’s current account surplus increased to JPY 3,968.3 billion in May 2026 from JPY 3,320.5 billion in the same month a year earlier, though it fell short of market expectations of JPY 4,121 billion. The goods account swung to a marginal surplus of JPY 0.07 billion from a JPY 497.1 billion deficit, as export growth (14.7%) outpaced import growth (8.1%). Meanwhile, the primary income surplus increased to JPY 4,275.6 billion from JPY 4,180.2 billion. The secondary income deficit narrowed to JPY 304.0 billion from JPY 493.5 billion. By contrast, the services account slipped into a marginal deficit of JPY 0.1 billion, reversing from a JPY 130.9 billion surplus a year earlier.