Japan’s Trade Hit by Rising Oil Prices, BoJ Chief Ueda Says

Bank of Japan Governor Kazuo Ueda warned that the sustained rise in global oil prices—fueled by escalating geopolitical tensions in the Middle East, supply-chain disruptions, and the continued weakness of the yen—is sharply increasing Japan’s already heavy energy-import burden.

He noted that higher crude costs are widening the nation’s trade deficit and feeding stronger cost-push inflation, raising production and transportation expenses for businesses while eroding household purchasing power. 

These pressures, he cautioned, are dampening consumer spending, weakening corporate profitability, and heightening the risk of a stagflation-like environment.

Ueda added that the situation also complicates the Bank of Japan’s policy outlook, as policymakers must navigate the challenge of stabilizing inflation, supporting economic recovery, and managing currency volatility while deciding the appropriate timing and pace of future interest-rate adjustments.