Japan’s trade deficit reached 2.81 trillion yen, or $17.8 billion, during the first half of the fiscal year, an unprecedented level for the country. Between April and September, exports rose 18.4%, while imports surged 20.4% to 63.5 trillion and 66.3 trillion yen respectively, setting record highs. Brent crude climbed from about $70 per barrel in February to nearly $110 as the Strait of Hormuz was effectively blocked, forcing Japan to use alternative routes for its oil shipments. In September, the trade deficit totaled 536.6 billion yen, down from 1.1 trillion yen in August, while the weakening yen, trading around 150 to the dollar, increased import costs. The Bank of Japan raised its benchmark interest rate to 1.25%, a 31-year high, and Prime Minister Sanae Takaichi’s government is seeking to cut the food tax from 8% to 1% to support lower-income households.
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