Japan's current account surplus in May fell 27.9 percent from a year earlier as the tourism sector was hit hard by a continued slump in overseas visitors due to the coronavirus pandemic, government data showed Wednesday.

According to the Finance Ministry, the current account surplus declined for a third straight month to stand at 1.18 trillion yen (10.97 billion U.S. dollars).

Of the account's key components, Japan's goods trade deficit dropped 18.1 percent to 556.8 billion yen (5.17 billion U.S. dollars), the ministry's preliminary data showed, while the services trade surplus retreated to 92.5 billion yen (860 million U.S. dollars) from 152.5 billion yen (1.41 billion U.S. dollars) booked a year earlier.

Money spent by overseas visitors in Japan compared to that spent by Japanese in foreign countries, logged a surplus of 22.4 billion yen (208.30 million U.S. dollars) in Japan's travel balance, plunging from 270.1 billion yen (2.51 billion U.S. dollars) booked in the previous year, the figures also showed.

Exports, meanwhile, fell 28.9 percent to 4.20 trillion yen (39.05 billion U.S. dollars), marking the third straight month of decline, while imports were down 27.7 percent to 4.75 trillion yen (44.18 billion U.S. dollars), falling for the 13th consecutive month, the latest data set showed.

Reflecting returns made on investments abroad, its primary income, booked a surplus of 2.04 trillion yen (18.97 billion U.S. dollars), dropping 10.9 percent, the ministry said.

Japan's current account surplus is one of the broadest measures of its trade with the rest of the world.

The data is keenly eyed by the Bank of Japan (BOJ) and the Finance Ministry ahead of new potential policy changes, monetary easing, or tapering measures.

In Japan, the current account surplus increases the nation's net foreign assets by the corresponding amount, and a current account deficit does the reverse.

Both the Japanese government and private payments are included in the calculation and it is called the current account because goods and services are generally consumed in the current period.

(Cover image: Districts in Tokyo, April 8, 2020. /Reuters)