Japan exports in May grow at fastest pace in more than three years, beating estimates
Honda Motor Co. vehicles bound for shipment at a port in Yokohama, Japan, on Thursday, Feb. 6, 2025. In Japan, nominal wages rose at the fastest pace in nearly three decades in December, supporting the Bank of Japan’s latest rate hike decision and keeping the bank on track for further tightening steps. Photographer: Toru Hanai/Bloomberg via Getty Images
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Japan’s exports in May grew at their fastest pace since November 2022, rising 17% year on year, beating expectations.
The figure was higher than the 16.2% expected by economists polled by Reuters, and up from the 14.8% in April.
Japan’s imports rose 12.5% year on year in May, the highest level since January 2025, topping the 12.8% expected in the Reuters poll.
Exports remain one of Japan’s main economic drivers, with its economy growing 0.5% sequentially in the first quarter and at 1.8% on an annualized basis.
The economic data comes after the Bank of Japan raised its policy rate on Tuesday by 25 basis points to the highest in over 30 years at 1%, as the country sees rising inflation and the yen stays weak.
A weak yen is likely to boost exports but also causes domestic worries by pushing up imported inflation and weakening purchasing power.
The yen was little moved, trading at 160.4 against the dollar. Japan’s currency has languished at historic lows even as its finance ministry used 11.7 trillion yen to defend the yen.
The Reuters Tankan survey — which measures business sentiment among large Japanese manufacturers and is closely watched by the central bank — climbed to +13 in June, the highest in three months, from +8 in May. The non-manufacturing index rose to +32.
A positive figure on the Tankan indicates that optimists outnumber pessimists.
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