Japan's current-account surplus in October plunged 16.7 percent from a year earlier to 1.08 trillion yen as exports shrank more than imports, the Finance Ministry announced Monday in a preliminary report.It was the ninth consecutive month of year-on-year decline in the surplus, and the trend is expected to continue for the time being, a ministry official said. The current-account balance is the difference between a country's income from foreign sources and foreign obligations payable, excluding net capital investment. The surplus in merchandise trade -- exports minus imports -- fell 14.4 percent to 1.3 trillion yen, making it the biggest factor behind the current-account balance. Exports decreased 6.1 percent while imports edged down 1.4 percent. Crude oil prices on a yen basis rose 33.8 percent from a year earlier, helping lower the decreasing rate of imports. The yen averaged 105.97 yen to the dollar in the month, higher than the 121.30 yen recorded a year earlier. A stronger yen can be a factor in reducing Japanese exports in the long run by raising their prices abroad. The services deficit shrank to 596.9 billion yen, down 128.3 billion yen, mainly because of a decrease in the deficit on miscellaneous trade-related services. As a result, the surplus in goods and services trade amounted to 707.8 billion yen, down 11.4 percent. The income account, which covers income from Japanese investment in foreign securities and payments by foreign employers to workers in Japan, left a surplus of 469.3 billion yen, down 146.5 billion yen from October 1998.
