P.M. BRIEFING : Japan Trade Surplus Down 90%

Surging imports pushed Japan’s trade surplus down 90% in January, its sharpest decline in five years, but the gap with the United States showed less dramatic improvement.

January’s customs-cleared trade surplus fell to just $340 million from $3.25 billion a year ago, the Finance Ministry reported today. The decline marks the ninth straight monthly narrowing of the surplus.

“This is probably an exaggeration of the trend but it shows the progress Japan is making in cutting the surplus,” said Hidehiro Iwaki, economist at Nomura Research Institute.

Exports shrank 3.8%--the fourth consecutive monthly decline--largely due to weak domestic demand in the United States and Europe.

Imports climbed 13.4% mainly on the back of hefty increases in crude oil prices.

The improvement in the surplus with the United States was less impressive than the overall figure. The gap with the United States fell 25.9% to $2.20 billion from $2.97 billion a year earlier.