Japan Unexpectedly Posts Trade Surplus

Japan’s trade surplus plunged to JPY 57.3 billion in February 2026 from JPY 559.2 billion a year earlier, as import growth outpaced exports. Still, the latest outcome defied market expectations of a JPY 483.2 billion deficit. Exports rose 4.2% year-on-year to JPY 9,571.6 billion, easing markedly from a 16.8% surge in January and marking the weakest growth since last October, amid softer demand from China and the U.S. Still, sales growth stretched into a sixth month, topping forecasts for a 1.6% rise. Meanwhile, imports jumped 10.2% to JPY 9,514.3 billion, below forecasts of 11.5% but rebounding from a 2.6% decline in January. This was the fastest increase in shipments since July 2024, supported by firm domestic demand following Tokyo’s large stimulus package introduced in November.

Japan’s trade deficit decreased significantly to JPY 1,152.7 billion in January 2026 from JPY 2,741.7 billion in the same month a year earlier, beating market expectations for a JPY 2,142.1 billion shortfall, as exports jumped while imports declined. Year-on-year, exports surged 16.8% to JPY 9,187.5 billion, sharply accelerating from a 5.1% growth in December and marking the fastest rise since November 2022, buoyed by strong demand from China and other Asian markets ahead of the Lunar New Year. Meanwhile, imports dropped 2.5% to JPY 10,340.2 billion, missing estimates of a 3% increase and reversing a 5.2% growth in December. It also marked the first drop in purchases since last August, despite Tokyo’s massive stimulus package launched in November, the first under the Takaichi administration.

Japan’s trade surplus narrowed to JPY 105.7 billion in December 2025 from JPY 120.3 billion in the same month a year earlier, missing market expectations for a JPY 357 billion gain, as imports grew a bit faster than exports. Imports climbed 5.3% year-on-year to an 11-month high of JPY 10,305.8 billion, extending gains for a fourth consecutive month and easily beating forecasts of 3.6%, highlighting solid domestic demand, underpinned by Tokyo’s large-scale stimulus package, the biggest since the pandemic and the first introduced under the Takaichi administration. Meanwhile, exports rose 5.1% to a record of JPY 10,411.5 billion, marking a fourth straight monthly increase, buoyed by strong year-end foreign demand and a weaker yen. However, the gain fell short of the consensus of 6.1%, as Japanese automakers continued to face a 15% U.S. tariff under the trade deal reached in September. In 2025, Japan logged a trade gap of about JPY 2.65 trillion, down 52.9% from the prior year.