Japan's exports experience the largest increase in three years

Japan’s exports recorded their fastest growth in over three years, with exports to China and the European Union surging. Data released by Japan’s Ministry of Finance on Wednesday showed that total exports in January increased by 16.8% year-on-year, the largest increase since November 2022, surpassing analysts’ median forecast of a 13% rise. Trade statistics indicate that Japan’s exports to the United States decreased by 5% year-on-year in January, while exports to the European Union increased by 29.6% year-on-year. The data suggests that as companies gradually absorb the impact of U.S. tariffs, merchandise exports continue to recover. U.S. tariffs were eased after a trade agreement was reached last year. Japan and the U.S. are working to implement Japan’s commitment to increase investment in the U.S., which is a key clause in the agreement to reduce U.S. tariffs on Japanese auto imports. At the time of this data release, the World Trade Organization’s optimism about the outlook for international trade continues to grow. WTO Director-General last month stated that the rapid development of artificial intelligence could support global merchandise trade this year, helping to offset the pressure from U.S. tariffs.