Japan BOP July Inbound Spending Up YoY for First Time Since March

Economics Research 8 September 2026 | 12:20PM JST

Japan: BOP: July Inbound Spending Up YoY for First Time Since March; Trust Banks Net Buyers of Foreign Bonds Again in August

BOTTOM LINE: Japan’s current account balance came in at a surplus of +¥3.0 tn in Yuriko Tanaka | July, up 15.6% from +¥2.6 tn in July 2025. Inbound spending by foreign visitors in Goldman Sachs Japan Co., Ltd. July rose +12.5% yoy, returning to a yoy increase for the first time since March. The primary income surplus remained at a high level. In August, domestic investors were net buyers of foreign equities, and trust banks (including pension funds) expanded their purchases of foreign bonds.

n July current account balance: +¥3.0 tn vs. GS forecast: +¥1.8 tn, BBG: +¥2.9 tn, July 2025: +¥2.6 tn n Seasonally adjusted CA balance: July: +¥2.5 tn, June: +¥1.4 tn

Inbound Spending Up YoY for First Time Since March, Partly Due to Base Effects According to the July balance of payments data (non-adjusted) from the Ministry of Finance (MOF), the current account came in at a surplus of +¥3.0 tn, up 15.6% from +¥2.6 tn in July 2025. While export value rose +24.1% yoy, import value increased by +25.9% yoy, and as a result, the trade deficit widened to -¥399.9 bn, from -¥187.7 bn in July 2025.

Travel receipts in the services account, which reflect foreign visitors’ inbound spending, came in at ¥811.5 bn, up +12.5% from ¥721.5 bn in the prior year. This marks the first yoy increase in four months, since March. However, as this was partly a rebound from a sharp slowdown in July of last year, we cannot conclude that inbound spending by foreign visitors has recovered, based on this single month’s data.

According to statistics on the number of foreign visitors, for which a breakdown by country/region is available, visitors from mainland China continued to fall sharply at -56.0% yoy, but visitors from South Korea (+31.8%), Taiwan (+26.4%), Singapore (+18.5%), and the UK (+11.8%) increased, among others. As a result, the overall number of visitors turned to a slight yoy increase of +0.1% in July, the first yoy increase since March.

Primary Income Surplus Remains High The primary income balance, which mainly reflects earnings from overseas assets, came in at a surplus of +¥4.3 tn in July, a slight increase from the +¥4.1 tn surplus in the prior year. The breakdown shows that dividend receipts and bond interest receipts on securities investments, which account for the majority of investment income, both increased. At the same time, bond interest payments from Japan also

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increased, reducing the net bond interest balance surplus on a yoy basis for the first time since January (July 2026: ¥896.1 bn; July 2025: ¥1.0 tn). Direct investment income, such as dividend receipts from overseas subsidiaries, increased to ¥2.0 tn, from ¥1.7 tn in the same month of the previous year.

The seasonally adjusted current account surplus for July was 4.4% of GDP (annualized; April-June: 5.0%).

In August, Domestic Investors Net Buyers of Foreign Equities, and Trust Banks (Including Pension Funds) Expand Purchases of Foreign Bonds; Foreign Investors Small Net Sellers of Japanese Equities and Domestic Bonds The MOF also announced international securities transactions data for August. Domestic investors were small net sellers of foreign medium- to long-term bonds at -¥143.0 bn (July: +¥365.7 bn). However, excluding transactions by banks’ banking accounts (which are volatile and mostly foreign currency-funded and were net sellers of ¥1.3 tn), net buying continued for the fifth consecutive month at +¥1.2 tn. By investor type, trust banks (including pension funds) expanded their net foreign bond purchases to +¥2.3 tn, from July (+¥895.7 bn). Life insurers (-¥137.3 bn) and investment trusts (-¥30.1 bn) were small net sellers for the third consecutive month.

Domestic investors expanded their net purchases of foreign equities to +¥1.3 tn (July: +¥169.5 bn). Trust banks (trust accounts), which had been large net sellers at a…