TOKYO, Japan / ConSynSer / – Japan’s exports experienced a 13th consecutive month of growth in September, yet a faster increase in imports resulted in a trade deficit of 536.6 billion yen. Initial data from the Ministry of Finance indicated that exports grew by 16.7% year on year to 10.9723 trillion yen. Meanwhile, imports rose by 18.9% to reach 11.5088 trillion yen. According to Xinhua News Agency, the deficit stood at approximately $3.4 billion.
The export expansion was primarily driven by strong demand for semiconductors and equipment used in chip manufacturing. Additionally, products related to artificial intelligence contributed to the shipment increase, 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 prices continue to exert significant 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 faced higher costs to secure shipments through alternative routes. Brent crude oil prices have surged from around $70 a barrel in February to roughly $110 a barrel.
Trade values reach record levels in the first half of fiscal year
For the April-to-September period, Japan’s trade deficit reached 2.81 trillion yen, approximately $17.8 billion, nearly doubling compared to the previous year. Exports during this half-year increased by 18.4% to 63.5 trillion yen, while imports jumped 20.4% to 66.3 trillion yen. Both figures marked historic highs for Japan, reflecting vigorous trade activity amid rising energy prices.
The escalation in oil prices has impacted numerous sectors, including plastics manufacturing and shipping. Nonetheless, exporters continue to benefit from global demand for chips and related equipment. Japan’s trade figures had previously set records in July, when imports exceeded exports. The latest statistics indicate a year of strong yet uneven trade performance.
Focus on Bank of Japan’s interest rate trajectory
A declining yen has led to increased costs for imported goods, with the US dollar trading at approximately 150 yen. The Bank of Japan has been incrementally raising interest rates, partly to support the yen. Its benchmark rate was increased to 1.25% from 1.0% last month, reaching a 31-year high. The central bank’s policy board is scheduled to meet again next week.
Japan’s inflation target remains around 2%. Experts suggest that oil prices are unlikely to decrease soon, which implies that import expenses will stay elevated. The Ministry of Finance’s upcoming monthly report will reveal whether export growth driven by chips can keep pace with rising energy costs. Japan’s trade outlook continues to be heavily influenced by developments in global energy markets.