Semiconductor equipment is driving the increase in energy costs
Japanese exports reached record levels in July, confirming the resilience of global demand and the growing importance of foreign sales in supporting an economy held back by weak domestic consumption. According to data from the Ministry of Finance, in July the total value of exports rose by 23.2% on an annual basis, exceeding analysts’ forecasts, and compared to +19.3% in June. This is the fifth consecutive monthly acceleration and the fastest growth rate since October 2022. The result was mainly driven by semiconductor equipment, the value of which jumped by 49.1%, driven by the boom in demand linked to artificial intelligence. Shipments to China, Tokyo’s main trading partner, grew by 25.8%, those to the United States by 22%. Imports increased by 27.8%, the sharpest increase since November 2022, also higher than expected, resulting in a trade deficit of 634.5 billion yen (3.44 billion euros), slightly lower than the expected deficit of 680 billion. In particular, the increase in oil prices, the most expensive from the United States, weighed heavily, with crude oil imports growing by 87.8% as a result of tensions in the Middle East, which in recent months have affected the Strait of Hormuz. According to data from the International Energy Agency, Japan covers over 87% of its energy needs from abroad.
