TOKYO, Japan / ConSynSer / – The Ministry of Finance reported that Japan experienced its 13th consecutive month of rising exports in September, although a surge in imports resulted in a trade deficit of 536.6 billion yen. The preliminary data indicated that exports increased by 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 deficit was roughly $3.4 billion.
The export growth was primarily driven by strong demand for semiconductors and chip manufacturing equipment. Additionally, products related to artificial intelligence contributed to the shipment boost, as reported by Xinhua. September marked Japan’s fifth consecutive month of trade deficits, though 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 arrivals.
Energy prices continue to exert substantial pressure on Japan’s trade balance. The country relies heavily on oil imports and has depended on access to the Strait of Hormuz, which has been disrupted by conflicts in the Middle East. Importers have had to pay higher prices to secure shipments through alternative routes. Brent crude has risen from around $70 a barrel in February to approximately $110 a barrel.
Trade values reach record heights in the first half of the fiscal year
Japan’s trade deficit for the April-to-September period hit 2.81 trillion yen, roughly $17.8 billion, nearly double the figure from the previous year. During this half-year, exports grew by 18.4% to 63.5 trillion yen, while imports surged by 20.4% to 66.3 trillion yen. Both figures set new records for Japan, reflecting vigorous trade activity amid rising energy prices.
The increase in oil prices is impacting various sectors, including plastics manufacturing and shipping. Meanwhile, exporters continue to benefit from global demand for chips and related equipment. Japan’s trade figures had also reached record levels in July, when imports outstripped exports. The recent data highlight a year of robust yet uneven trade performance.
Focus shifts to Bank of Japan’s interest rate trajectory
The weakening yen remains a factor in rising import costs, with the US dollar trading at around 150 yen. The Bank of Japan has been gradually raising interest rates, partly to support the currency. Its benchmark rate increased to 1.25% from 1.0% last month, marking a 31-year high. The central bank’s policy board is scheduled to meet again next week.
The bank’s inflation target is approximately 2%. Analysts suggest that oil prices are unlikely to decrease soon, implying that import expenses will stay elevated. The Ministry of Finance’s upcoming monthly report will reveal whether export growth driven by chips can sustain itself amidst rising energy costs. Japan’s trade outlook remains closely linked to developments in global energy markets.