Japan: Smaller than expected current account surplus - BBH

Japan reported a somewhat smaller than expected November current account surplus and it typically (seasonally) is smaller in November than October, but the decline from JPY2.18 trillion to JPY1.35 trillion was more than expected.  Part of it could be accounted for by trade, explains the research team at BBH.  

Key Quotes

“The trade surplus of JPY181 bln was expected to be closer to JPY310 bln.  Still, the main takeaway ought to be that Japan is on pace for the largest current account surplus since 2007.”

The dollar is extending this week's losses against the yen.  It is now near JPY111, which is the 50% retracement or the rally since early September.  The November low extended to JPY110.85.  A convincing break could spur a move toward JPY110.  A $1.1 bln option struck at JPY111.00 expires today.”   

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