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. Data from the Ministry of Finance indicated that exports rose 16.7% year on year to 10.9723 trillion yen, while imports grew by 18.9% to 11.5088 trillion yen. According to Xinhua News Agency, the trade deficit was approximately $3.4 billion.
The surge in exports was driven by strong global demand for semiconductors and chip manufacturing equipment. Additionally, shipments linked to artificial intelligence contributed to the positive trend, 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. The pace of import growth slowed from 28.0% in August, partly due to a decline in crude oil imports.
Persistent energy costs continue to exert pressure on Japan’s trade balance. The country relies heavily on oil imports and has historically depended on access to the Strait of Hormuz, which has been disrupted by conflicts in the Middle East. As a result, importers have faced higher costs when sourcing shipments through alternative routes. Brent crude prices have increased from around $70 a barrel in February to approximately $110 a barrel.
Trade volumes hit new highs in first half of fiscal year
During April to September, Japan’s trade deficit reached 2.81 trillion yen, roughly $17.8 billion, nearly double the deficit from the previous year. Exports for this period increased by 18.4% to 63.5 trillion yen, while imports rose by 20.4% to 66.3 trillion yen. These figures set new records for Japan, reflecting vigorous trade activity amid rising energy prices.
Rising oil prices are impacting multiple sectors, including plastic manufacturing and shipping. Meanwhile, exporters continue to benefit from sustained global demand for chips and related equipment. Japan’s trade figures had previously reached record levels in July, when imports outstripped exports. The recent data point to a year of resilient yet uneven trade performance.
Focus shifts to Bank of Japan’s interest rate trajectory
A declining yen continues to elevate the cost of imports, with the US dollar trading at approximately 150 yen. The Bank of Japan has been gradually increasing interest rates, partly to bolster the yen. It raised its benchmark rate to 1.25% from 1.0% last month, marking a 31-year high. The policy board is scheduled to meet again next week.
The central bank aims for an inflation target of around 2%. Analysts believe that oil prices are unlikely to decline soon, implying that import expenses will remain high. The upcoming monthly report from the Ministry of Finance will reveal whether export growth driven by chips can sustain itself amid rising energy costs. Japan’s trade outlook remains closely linked to fluctuations in global energy markets.