Containers at a shipping terminal in Yokohama, Japan, October 18, 2021. Japan’s trade deficit widened in September as imports outpaced export growth.
Kiyoshi Ota | Bloomberg | Getty Images
Japanese exports climbed 16.8% year-on-year in January, well above market expectations and growing at their fastest pace since November 2022, as shipments to Asia and Western Europe surged, according to government data released Wednesday.
Growth was higher than December’s 5.1 percent and beat estimates of 12 percent by economists polled by Reuters.
The value of exports to China, Japan’s largest trading partner, jumped 32%, after rising 5.6% in December, at a time when the two countries are engaged in a diplomatic standoff over Prime Minister Sanae Takaichi’s comments on Taiwan.
Shipments to the United States fell 5%, after falling 11.1% in December. Washington is Japan’s second largest trading partner.
Regionally, a nearly 26% increase in shipments to Asia and more than 25% to Western Europe helped accelerate export growth and more than offset a 3.3% decline in North America.
Food, machinery and electrical machinery – which includes chips – were the fastest growing products, up 31.3%, 14.3% and 27.3%, respectively.
Transport equipment, which contributes more than 20% to exports, increased by 0.8%. The segment, which includes cars and auto parts and has been a key growth driver for Japanese exports, has come under pressure following U.S. tariffs.
from Japan Nikkei 225 The stock index rose 0.9%, while the broader Topix gained 1.26%. The yen strengthened slightly to 153.43 against the U.S. dollar, while the yield on benchmark 10-year government bonds was down 1 basis point at 2.119%.
Stock chart iconStock chart icon
Nikkei 225 performance so far this year
In January, imports fell 2.5% year-on-year, compared with a 3% rise estimated by Reuters and a 5.1% jump the previous month.
The meteoric growth in outbound shipments will be a welcome start to the new year after Japan’s export growth declined to 3.1% last year, compared with the 6.2% rise seen in 2024.
The Japanese the economy grew by only 0.1% year-on-year in the fourth quarter, supported by private demand, but net exports shaved 0.8 percentage points of growth. Over the year as a whole, GDP increased by 1.1% year-on-year, also weighed down by net exports.
Japanese shipments fell in mid-2025, hit by concerns over US tariffs, but saw a rebound towards the end of the year after the announcement of a trade deal with the United States that saw duties were reduced to 15%.
The United States announced projects valued at $36 billion on Tuesday, according to a Reuters report, including an oil export facility in Texas, an industrial diamond factory in Georgia and a natural gas-fired power plant in Ohio, which will be financed by Japan as part of its $550 billion U.S. investment commitment.
“Our MASSIVE trade deal with Japan has just launched! Japan is now moving forward, officially and financially, with the FIRST round of investments as part of its $550 BILLION commitment to invest in the United States of America,” US President Donald Trump said in an article on Truth Social.
Last week, Japanese Economy Minister Ryosei Akazawa was quoted by public broadcaster NHK as saying he hoped the first plans would be finalized before Takaichi and Trump meet.
Trump announced the meeting with Takaichi just before the Feb. 8 lower house elections, which saw Takaichi lead the ruling Liberal Democratic Party to a vote. crushing victory.
