TOKYO, Japan / ConSynSer / – In September, Japan experienced its 13th consecutive month of export growth, yet a faster increase in imports resulted in a trade shortfall of 536.6 billion yen. According to preliminary data from the Ministry of Finance, exports climbed 16.7% year on year to 10.9723 trillion yen. Meanwhile, imports grew by 18.9% to reach 11.5088 trillion yen. Xinhua News Agency estimated the trade deficit at approximately $3.4 billion.
The boost in exports was primarily driven by robust demand for semiconductors and chip manufacturing equipment. Additionally, products related to artificial intelligence contributed to the shipment increase, as reported by Xinhua. Despite this, September marked Japan’s fifth consecutive month of trade deficits, although the gap significantly shrank from 1.11 trillion yen in August. Import growth slowed from 28.0% in August, partly due to a decline in crude oil arrivals.
Energy costs continue to exert significant pressure on Japan’s trade balance. The country relies almost entirely on oil imports and has depended on access to the Strait of Hormuz, which has been disrupted by conflict in the Middle East. As a result, importers have faced higher expenses to secure shipments through alternative routes. Brent crude prices have risen from around $70 per barrel in February to roughly $110 a barrel.
Trade values hit record highs in first half of fiscal year
During April to September, Japan’s trade deficit reached 2.81 trillion yen, approximately $17.8 billion, nearly doubling compared to the same period last year. Exports for the half-year increased by 18.4%, totaling 63.5 trillion yen, while imports surged 20.4% to 66.3 trillion yen. These figures set new records for Japan, reflecting vigorous trade activity amid rising energy prices.
The surge in oil prices is impacting various sectors, including plastics manufacturing and shipping. Despite this, exporters continue to benefit from the global demand for chips and related equipment. Japan’s trade figures previously reached records in July, when imports outstripped exports. The latest data continue a year marked by strong yet uneven trade performance.
Market expectations for Bank of Japan rate adjustments
A declining yen has increased the cost of imported goods, with the US dollar trading at approximately 150 yen. The Bank of Japan has been gradually raising interest rates to support its currency, increasing its benchmark rate to 1.25% from 1.0% last month, the highest in 31 years. The policy board is scheduled to meet again next week.
With an inflation target of about 2%, analysts believe that oil prices are unlikely to decrease soon, which could keep import bills elevated. The upcoming monthly report from the Ministry of Finance will reveal whether export growth driven by chips can keep pace with rising energy costs. Japan’s trade outlook remains strongly linked to developments in the global energy markets.