P.M. BRIEFING : Japan Trade Surplus Cut 50%
Surging imports helped Japan slash its trade surplus more than 50% in April, but economists said the narrowing trend is unlikely to last beyond this summer.
The customs-cleared trade surplus dropped 50.4% to an unadjusted $3.54 billion in April from $7.29 billion a year earlier, the Finance Ministry reported today.
Although the monthly decline was the sharpest since January, economists said the introduction of a consumption tax on April 1, 1989, had exaggerated the fall.
An import boom in March, 1989, before the 3% tax was slapped on most goods and services, choked itself out the following month.
“The implementation of the consumption tax had a major impact in distorting this month’s data,” said Russell Jones, economist at UBS Philips and Drew International.
Nonetheless, the sharp narrowing in the surplus was welcomed by Japanese officials after the politically sensitive gap widened in March for the first time in nearly a year.
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