TOKYO, Japan / ConSynSer / – In September, Japan experienced its 13th consecutive month of rising exports, yet a more rapid increase in imports resulted in a trade deficit of 536.6 billion yen. According to preliminary data from the Ministry of Finance, exports increased by 16.7% year on year to 10.9723 trillion yen, while imports grew by 18.9% to 11.5088 trillion yen. Xinhua News Agency estimated the deficit at around $3.4 billion.
The export uptick was driven mainly by strong demand for semiconductors and chip manufacturing equipment. Additionally, shipments linked to artificial intelligence contributed to the overall growth, as reported by Xinhua. September marked Japan’s fifth straight month of trade deficits, although the gap significantly narrowed 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 substantial pressure on Japan’s trade balance. As Japan imports nearly all its oil and relies on access to the Strait of Hormuz, disruptions caused by conflicts in the Middle East have forced importers to pay higher prices for alternative routes. Brent crude oil prices have risen from about $70 per barrel in February to roughly $110 a barrel.
Trade values hit new highs in first half of fiscal year
From April to September, Japan’s trade deficit reached 2.81 trillion yen, approximately $17.8 billion, nearly double the figure from the previous year. During this period, exports rose 18.4% to 63.5 trillion yen, while imports increased 20.4% to 66.3 trillion yen. These are Japan’s highest-ever trade figures, reflecting vigorous trade activity amid rising energy prices.
The surge in oil prices is impacting various sectors, including plastics and shipping, yet exporters continue to benefit from global demand for chips and related equipment. Japan’s trade values had already reached records in July, when imports exceeded exports. The current figures extend a year characterized by robust but fluctuating trade performance.
Focus on Bank of Japan’s interest rate trajectory
A declining yen has raised costs for imported goods, with the US dollar trading at around 150 yen. The Bank of Japan has been gradually raising interest rates, partly to support the yen, increasing its benchmark rate to 1.25% from 1.0% last month — the highest in 31 years. Its 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, indicating that import expenses will stay elevated. The Ministry of Finance’s upcoming monthly report will indicate whether export growth driven by chips can keep pace with rising energy costs. Japan’s trade outlook remains heavily influenced by developments in global energy markets.