Japan's Exports Growth Accelerated and Inflation Eased In April

Akira Ito
22 May, 2026
Tokyo

Japan's indexes advanced on Friday and extended gains of the previous session amid renewed optimism over the artificial intelligence-related stocks. 

The Nikkei 225 Stock Average soared nearly 3%, the broader TOPIX advanced over 1%, and the yen weakened to 159.07 against the U.S. dollar. 

Investors allocated more capital to technology and AI-related stocks following solid earnings from Nvidia Corp. and OpenAI and SB Energy inching closer to their initial public offerings in the U.S. 

Tech stocks rebounded after Nvidia Corp., the key advanced semiconductor chipmaker, reported solid revenue and earnings growth in its latest quarter, driven by a 92% surge in revenue from AI-driven data centers. 

The latest boom in the buildout of AI factories has catapulted the market cap of Nvidia from $400 billion at the end of 2022 to $5.4 trillion as of Wednesday. 

The yen continued to approach the 160 level against the U.S. dollar, and investors reviewed the latest inflation updates. 

 

Japan's Overall Inflation Stayed Below BoJ Target Rate

Japan's annual overall and core inflation remained below the central bank's 2% target rate for the fourth consecutive month in April. 

Overall inflation eased to an annual rise of 1.4%, and core inflation slowed to 1.4% from 1.8% in March, respectively, according to the Ministry of Internal Affairs and Communications. 

The electricity prices fell at a slower pace of 2.6% from 8.0% in the previous month, as the impact of government subsidies faded. 

Energy costs declined 3.9% following a 5.7% fall in March, and retail prices of petrol plunged 9.7% after the government offered price support to consumers. 

Prices for food, excluding fresh items, rose at a slower annual pace of 4.1% from a 5.2% rise in the previous month. 

The latest consumer price inflation report did not provide any clear sign about the inflation in the months ahead, but investors are anticipating the Bank of Japan raising rates in the fourth quarter. 

Core-core inflation, which excludes volatile food and energy prices to reflect underlying price trends, slowed to an annual rise of 1.9%, the softest pace of increase since July 2024. 

 

Japan's Real Wages Extended Decline to Fourth Consecutive Year

Japan's monthly average wage gains failed to keep up with price hikes in the financial year ending in March, according to the latest report by the Ministry of Health, Labor, and Welfare. 

Japan's real wages, or cash earnings per worker including base and overtime pay adjusted for inflation, declined 0.5% in fiscal 2025, marking the fourth consecutive year of decline, a separate report from the government showed on Friday. 

Nominal monthly wages rose 2.5% to 357,979 yen, or $2,250, and consumer prices rose 3.0% in the reporting year, slower than 3.5% in the previous year. 

 

Rising Global Demand Accelerated Japan's Export Growth In April

Japan's exports and trade surplus rose in April, amid a strong demand for electrical and electronic products in the ASEAN region, the EU, China, India, and the U.S. 

Exports rose annually 14.8% to 10.5 trillion yen, accelerating from an 11.5% rise in March, marking the eighth consecutive month of increase, reflecting resilient global demand despite supply disruptions caused by the U.S. and Israel's war on Iran.

Shipments to the European Union soared 26.9%, to the ASEAN region advanced 19.9%, to China by 15.5%, to the U.S. by 9.5%, and to India by 8.9%. 

However, shipments to the Middle East shrank by 56% from a year ago, amid supply disruptions in the Strait of Hormuz. 

Imports advanced 9.7% to 10.2 trillion yen, and Japan switched crude oil imports from the Middle East to the U.S. amid ongoing tensions in the Middle East. 

The total shipments of the fuel to Japan plunged 63.7% by volume and 49.4% by value in April, the government data showed. 

The value of imports from the U.S. soared 118% and from the Middle East declined by 67% in volume from a year earlier, according to the preliminary trade statistics from the Ministry of Finance.

The trade balance swung to a surplus of 301.9 billion yen in April from a deficit of 149.5 billion yen in the corresponding month a year ago. 

The trade surplus was the largest since November, as growth in exports outpaced the imports, and import demand remained resilient, partly because of the government's supportive measures introduced in late 2025.

 

Japan Indexes and Stocks 

The Nikkei 225 Stock Average jumped 2.7% to 63,325.64, and the broader TOPIX advanced 1.1% to 3,897.03. 

Semiconductor- and AI-related stocks led gainers in Tokyo as investors returned to increase exposure to fast-growing companies. 

Fujikura Ltd, SoftBank Group, Tokyo Electron, and Advantest Corp. rose between 4% and 10%. 

Nippon Yusen, Kawasaki Kisen Kaisha, and Mitsui OSK Lines decreased between 0.5% and 1.4%.