Yen Rally Extends to Seventh Session, Japan's Export Growth Slows to 7-Month Low

Akira Ito
21 May, 2025
Tokyo

Japan's benchmark indexes struggled to rise above the flatline, and investors awaited  the outcome of the third round of trade negotiations with the U.S. 

The Nikkei 225 Stock Average declined 0.3%, and the broader Topix index fell a fraction, and investors reviewed the latest international trade statistics released by the Ministry of Finance. 

 

Japan Export Growth Slows In April and Annual Trade Deficit Shrank 

Japan's exports in April rose 2% from a year ago to 9.16 trillion yen, and imports fell 2% to 9.27 trillion yen, resulting in a decrease in the trade deficit to 115.85 billion yen compared to 504.69 billion a year ago. 

Exports advanced for the seventh month in a row, but the increase was the slowest amid U.S. tariff headwinds, and exports to the U.S. fell 1.8% amid a decline in demand for vehicles, steel, and ships. 

Exports to the European Union declined 5.2%, fell to China 0.6%, and eased to Russia 3.0%. Meanwhile, shipments to the ASEAN region increased 1.9%. 

Japan is among the hardest hit countries by the U.S. tariffs, with vehicles and aluminum and steel exports attracting 25% tariffs. 

Vehicle exports account for 28.3% of total exports to the U.S., and Japan's top trade negotiator, Ryosei Akazawa, has called for the removal of U.S. tariffs. 

 

Japan Indexes and Stocks 

The Nikkei 225 Stock Average decreased 0.3% to 37,401.03, and the broader Topix index eased 0.01% to 2,738.49. 

The yen gained for the seventh session in a row and traded at 143.67 against the U.S. dollar, as foreign investors sought safety in Japanese assets amid "Sell America" sentiment in Asia. 

Toyota Motor advanced 0.2% to ¥2,677.50, Honda Motor gained 1.6% to ¥1,444.50, and Nissan Motor advanced 1.5% to ¥364.60. 

Tokio Marine declined 2.5% to ¥5,656.0, and the insurance company said it plans to repurchase up to 70 million shares for as much as 110 billion yen, representing about 3.64% of total outstanding shares. 

The stock repurchase program is valid until the end of October 2025, and as of now, there are 1.92 billion outstanding shares and 9.11 million treasury shares.