Japan Imports Unexpectedly Fall

Japan’s imports declined 2.5% yoy to JPY 10,340.2 billion in January 2026, missing market expectations of a 3% rise and reversing December’s 5.2% increase. The latest result marked the first contraction in purchases since last August, suggesting softer domestic demand and lower energy costs after winter stockpiling boosted imports late last year. Moreover, the pullback came despite Tokyo’s sizeable stimulus package announced in November, the first under the Takaichi administration. Imports fell for mineral fuels (-14.1%), machinery (-9.2%), chemicals (-6.7%), and transport equipment (-7.5%); but grew for electrical machinery (7.3%), others (2.3%), and manufactured goods (4.8%). Purchases shrank from South Korea (-4.2%), the ASEAN countries (-4.7%), India (-22.1%), Vietnam (-0.5%), Australia (-13.3%), the EU (-0.7%), and the Middle East (-14.5%). In contrast, arrivals grew from the U.S. (3.0%), Hong Kong (6.4%), Taiwan (19.1%), and Russia (6.0%).

Japan’s imports rose 5.3% year-on-year in December 2025, reaching an 11-month high of JPY 10,305.8 billion. The latest figure outpaced market expectations of 3.6% and sharply accelerated from November’s modest 1.3% gain. It also marked the fastest growth in purchases since January, underscoring robust year-end domestic demand fueled by Tokyo’s sweeping stimulus package, the largest since the pandemic and the first unveiled under the Takaichi administration. Imports grew for most components, including electrical machinery (22.7%), other goods (13.3%), machinery (9.2%), chemicals (16.6%), and manufactured goods. In contrast, mineral fuel purchases fell 12.5%, dragged by drops in petroleum (-8.6%) and LNG (-6.7%). Imports expanded from China (14.7%), the U.S. (9.2%), Hong Kong (7.5%), Taiwan (18.7%), Vietnam (19.6%), the ASEAN countries (5.8%), Russia (1.9%), the EU (21.6%), and South Africa (12.2%), but fell from South Korea (-6.7%), Australia (-16.0%) and the Middle East (-10.8%).

Japan’s imports increased 1.3% year-on-year to JPY 9,392.4 billion in November 2025, signaling the third straight monthly growth but below market estimates of 2.5%. The latest print followed a 0.7% rise in October, reflecting subdued domestic demand and lingering cost pressures, despite Tokyo’s JPY 21.3 trillion stimulus package, the largest since the pandemic and the first under the Takaichi administration, which includes winter energy subsidies starting January 2026. Also, Japanese firms continue to face 15% tariffs despite a September U.S.–Japan trade deal. Mineral fuel purchases fell 13.4%, led by drops in petroleum (-2.4%) and LNG (-17.7%), while imports of electrical machinery (4.0%), machinery (12.3%), and other goods (14.2%) grew. Purchases rose from China (2.3%), the U.S. (7.1%), Taiwan (22.7%), Vietnam (14.5%), ASEAN countries (3.4%), and the EU (6.8%), but fell from Hong Kong (-17.1%), South Korea (-9.7%), Australia (-16.0%), Russia (-15.8%), and the Middle East (-10.4%).