Japan’s September exports rise 16.7%, helped by chip demand

TOKYO – Japan's exports surged 16.7% in September compared to the previous year, driven by robust demand for semiconductors and AI-related products, according to government figures released on October 21. This marked the 13th consecutive month of export growth, surpassing a market forecast of 20.1% increase. Despite falling short of the forecast, the increase was attributed to global investment in artificial intelligence and corporate pricing strategies.

US exports climbed by 22.9%, while shipments to China grew by 8.6%. However, imports rose 18.9%, slower than expected due to reduced crude oil deliveries resulting from vessel reroutes around Yemen's Bab el-Mandeb Strait following a naval blockade declared by Iran-aligned Houthi militia. October's crude oil imports are projected to recover to near pre-conflict levels once tankers resume use of the Suez Canal, the government announced.

September's trade deficit narrowed to 536.6 billion yen ($4.33 billion) from 1.1 trillion yen in the previous month, lower than the forecasted 181 billion yen deficit. The data indicates external demand continues to bolster Japan's economy, although global uncertainty persists and will be closely monitored by markets during the Bank of Japan's upcoming policy meeting in October, where fresh quarterly growth and inflation forecasts will be disclosed.