Japan: Exports lose further steam in April
Latest reading: Yen-denominated merchandise exports increased 2.0% annually in April. The print was in line with market expectations and was down from March’s 4.0% increase.
Meanwhile, yen-denominated merchandise imports shrank 2.2% in April, flipping from March’s 1.9% rise.
Overall, the yen-denominated merchandise trade balance switched to a JPY 0.1 trillion deficit from the previous month’s near JPY 0.6 trillion surplus, which had been one of the strongest figures in the last four years.
Outlook: Since Trump announced “reciprocal” tariffs on 2 April, our panelists have cut their forecasts for Japan’s growth of exports of goods and services in 2025 by 0.9 percentage points.
Still, exports are still seen expanding more quickly than in 2024, boosted by higher demand for IT products, a Japanese forte. Moreover, Japan and the U.S. remain locked in trade talks, with the leaders of both countries set to meet in person at the G7 summit in Alberta during 15–17 June.
Panelist insight: Nomura’s Yuki Kodera and Kyohei Morita said:
“After adjusting for inflation and seasonality, we estimate that real goods exports were up +0.5% m-m in April and that real goods imports were up +2.8%. April real exports were also 1.2% higher than the Jan–Mar average and real imports were 2.0% higher. We forecast (as of 16 May) real exports (goods and services) in the Apr–Jun GDP statistics up 0.2% q-q and real imports down 0.5%, with external demand (net exports = exports – imports) contributing +0.1ppt q-q to real GDP growth.”