High Energy Prices Deepened Japan's Trade Deficit Fourth Consecutive Month In August

Akira Ito
16 Sep, 2026
Tokyo

Japan's benchmark indexes lacked direction ahead of rate decisions from major central banks later in the week. 

The Nikkei 225 Stock Average increased 0.6%, the broader Topix advanced 0.7%, and the Japanese yen weakened to 155.28 against the U.S. dollar. 

The U.S. Federal Reserve is scheduled to announce its rate decisions later in the day, as policymakers review the persistent inflation over the last five years. 

The Bank of Japan is scheduled to announce policy decisions and estimates of inflation and economic growth on Friday, and investors are widely anticipating rate hikes. 

Investors are anticipating a rate hike of 25 basis points, and policymakers are set to revise higher inflation and economic growth estimates. 

 

Japan's Trade Deficit Widened Fourth Consecutive Month in August

Japan's exports rose at a faster-than-estimated pace in August, but the international trade balance turned to a deficit for the fourth consecutive month. 

Exports soared 19.3% to 10.0 trillion yen and advanced for the 12th month in a row, lifted by robust demand for AI-related chips and semiconductor equipment, despite risks from supply chain disruptions due to the Middle East conflict. 

Exports to China increased by 20.6% compared to a year ago, exports to the U.S. rose by 24.9%, exports to the EU grew by 11%, and exports to ASEAN surged by 22.2%. 

Semiconductor exports to China remained firm amid the sustained demand for artificial intelligence infrastructure, while exports of vehicles to the U.S. also increased.

By category, exports increased across all major components, led by a 31.5% rise in electrical machinery and a 7.2% advance in transportation equipment, mainly on motor vehicles. 

Imports soared 28.5% to 11.2 trillion yen, and crude oil shipments soared 58.7% to 1.2 trillion yen.     

The yen-denominated price of crude oil per kiloliter rose 53.1%, reflecting a weaker yen and a surge in international prices. 

Crude oil imports through the Strait of Hormuz decreased 30.9% as the shipments through the critical waterways remained disrupted for the seventh consecutive month. 

Japan's U.S. crude oil imports soared sevenfold from a year ago to 3.66 million kiloliters, as the U.S. pressured Japan to diversify its energy sources.   

Japan's international trade deficit soared to 1.1 trillion yen, or $7.1 billion, from 294.1 billion yen, marking the fourth consecutive month of deficit and the largest since January.   

 

Japan Indexes and Stocks 

The Nikkei 225 Stock Average increased 0.6% to 63,811.13, and the broader Topix advanced 0.7% to 4,065.27. 

Technology stocks traded mixed as investors debated the longevity of the sustained demand for AI-related products. 

Kioxia Holdings declined 2.6% to ¥50,400.0, Tokyo Electron increased 1.4% to ¥51,420.0, Advantest Corp. rose 0.6% to ¥30,340.0, and Taiyo Yuden Company gained 1.6% to ¥9,306.0.