Japan logged its largest current account deficit since 2014 amid soaring imported crude oil costs that offset gains in investment incomes.
The deficit in the current account highlights the dependence of Japan on imports of commodities and raw materials.
Japan posted current account deficit of 1.1887 trillion yen in January, the data showed, versus economists’ median estimate of a 880 billion yen deficit in a Reuters poll.
It was the second straight month of deficit after slowing demand from China before the Lunar New Year holidays put a drag on Japan’s recovery from COVID-19-induced doldrums. It also marked the second largest deficit under comparable data going back to 1985.
Imports costs rose by 39.9% in January from the same period last year due to surging fuel costs, while exports rose 15.2 % only.
A weak yen also inflated the cost of imports, helping to lead to a trade deficit.