Under the haze of tariffs, Japan's exports slowed for the second consecutive month

Source: Wall Street News

The country's exports rose 2% year-on-year in April, a second straight month slowdown, according to data released by the Japanese government on Wednesday. This is the lowest growth rate since October last year and the worst performance since exports shrank by 1.7% in September last year.

At the same time, Japan's imports shrank by 2.2% year-on-year that month, a decrease of less than expected by 4.5%. Japan's trade deficit narrowed to 115.8 billion yen (about 803.1 million US dollars), lower than expected 227.1 billion yen, with a trade deficit of 559.4 billion yen in March.

Under the impact of tariffs, Japan's GDP data in April fell into shrinking. Preliminary data from the Japanese government showed that real GDP shrank by 0.7% on an annualized basis in the first quarter of this year, mainly dragged down by stagnation of private consumption and slowdown in export growth.

High-pressure tariff policy: Japan's manufacturing industry is under pressure

Media reports pointed out that Japan's exports of automobiles, steel and aluminum to the United States are currently facing high tariffs of 25%. Customs data shows that automobiles are Japan's largest export to the United States, accounting for 28.3% of all exports to the United States in 2024.

As a key ally of the United States, Japan is also affected by Trump's benchmark tariffs imposed on most trading partners. In addition, Japanese goods also face a 24% "reciprocal tariff", but this part of the tariff has been temporarily shelved.

On April 2, the Trump administration imposed "reciprocal tariffs" on more than 180 countries, including Japan, and then set a "90-day tariff grace period" to allow trading partners to negotiate with them. The uncertainty of tariffs poses an ongoing risk to the Japanese economy, which relies on exports, and Japan's export-oriented companies may face further profit pressure.

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