TMTPOST – Japan’s exports fell 1.7% year-on-year in May, the sharpest decline since September 2024, amid trade uncertainties caused by “Liberation Day” tariffs.  

The fall was a reversal compared to the 2% gain recorded in April.

Japan’s exports to the United States tumbled 11.1% year on year in May and its exports to China, Japan's largest trading partner, was down 8.8%, according to data from Japan’s trade ministry.

The data comes a day after the Bank of Japan highlighted in its monetary policy statement that the country's economic growth was likely to slow down due to factors like trade, which would lead to a slowdown in overseas economies and a decline in domestic corporate profits.

"It is extremely uncertain how trade and other policies in each jurisdiction will evolve and how overseas economic activity and prices will react to them," the BOJ added.

Falling exports had already affected Japan's GDP negatively, with its economy shrinking 0.2% in the quarter ending March compared with the fourth quarter of 2024, marking the first time in a year for the economy to contract on a quarter-on-quarter basis.

Imports to the world's third largest economy fell 7.7% in May.

Japan's trade deficit stood at 637.6 billion yen in May. On Wednesday, U.S. President Donald Trump reportedly said that Japan was being "tough" in trade talks, after six rounds of negotiations between Japan's top negotiator Ryosei Akazawa, U.S. Commerce Secretary Howard Lutnick and Treasury Secretary Scott Bessent failed to reach a conclusive deal.

Japan’ s exports to the U.S. has been imposed a 10% baseline tariff, but that figure could be increased to 24% under Trump's currently suspended "reciprocal tariffs" if the country does not reach a deal by the time the deadline expires on July 9.