The current account surplus narrowed in October for the eighth month in a row as the deepening global slowdown caused exports to fall, the Finance Ministry said Monday.
The surplus shrank 56.5 percent to ¥960.5 billion from a year earlier, the ministry said. The median estimate in a survey of 22 economists was for the gap to narrow to ¥1.09 trillion.
Exports slumped the most in seven years, worsening Japan's first recession since 2001, as the worldwide financial crisis choked off demand for cars and electronics. The yen's 20 percent gain against the dollar is adding to exporters' woes and eroding the value of investments Japanese have overseas.
"Exports will probably stay weak because of slowing global demand, taking a toll on Japan's economy," said Susumu Kato, chief economist at Calyon Securities in Tokyo. "The stronger yen also hurt exporters' earnings and trimmed interest made on securities investments abroad."
Shipments abroad fell 7.3 percent in October from a year earlier, the most since December 2001, the Finance Ministry said. Imports climbed 8 percent, a quarter of the pace of September's 33 percent, as energy costs fell.
Crude oil traded at $77.48 a barrel in October on average, falling from a record $147.27 a barrel on July 11.
The income surplus, the difference between money earned abroad and payments made to foreign investors in Japan, shrank 16.3 percent to ¥1.21 trillion from a year earlier because of the yen's appreciation. The yen surged 7.8 percent against the dollar in October, the biggest monthly gain since December 1998.