Japan’s trade deficit widened sharply to JPY 1,105.6 billion in August 2026 from JPY 294.1 billion a year earlier, coming in slightly larger than market expectations for a JPY 1,052.6 billion shortfall. This marked the fourth consecutive monthly deficit and the largest since January, as import growth continued to outpace exports.
Imports surged 28.0% year-on-year to JPY 11,153.9 billion, following a 27.9% increase in July and surpassing forecasts of 26.3%. It was the fastest import growth since November 2022, underpinned by resilient domestic demand partly supported by the government’s late-2025 stimulus measures. Crude oil imports jumped 58.7% as Japan diversified its energy procurement away from the Strait of Hormuz amid persistent geopolitical tensions.
Exports climbed 19.3% to JPY 10,048.4 billion, exceeding market expectations of an 18.2% rise. Outbound shipments expanded for the 12th consecutive month, driven by strong global demand for AI-related semiconductors, even as supply-chain risks remained elevated due to the ongoing conflict in the Middle East.
