Exports measured by value increased 7.2% from a year earlier led by shipments of cars and ships, the Ministry of Finance reported Wednesday. That compared with the consensus estimate of a 7.7% gain. Shipments to China fell as the lunar new year holidays disrupted trade flows.
Imports surged 16.7% led by communication machinery and computers, and beat the median estimate of a 9.3% increase. Japan’s trade balance swung back into the red, with a deficit of ¥2.76 trillion ($18.2 billion), the largest in two years. By region, shipments to the US rose 8.1%, while those to China fell 6.2%. Exports to Europe declined 15.1%.
The global trade outlook is increasingly uncertain. Trump said Tuesday he would likely impose tariffs on automobile, semiconductor and pharmaceutical imports of around 25%, with an announcement coming as soon as April 2.
His fresh tariffs against China already prompted retaliatory levies from Beijing, and the president has also threatened a range of measures against other nations, including 25% levies on steel and aluminum imports that will take effect in March and reciprocal tariffs on numerous trading partners.
Japan, whose two biggest trading partners are the US and China, is bracing for the potential impact and trying to minimize fallout. Tokyo has asked Trump to exclude it from the steel and aluminum steps as well as the reciprocal duties while it also seeks details regarding his other levy plans.
Japan’s longstanding trade surplus with the US continues to risk the ire of Trump, who favors using levies to close trade gaps with other nations. Japan’s trade surplus with the US was ¥477 billion in January. Auto exports to the US surged 21.8% in the month.
