Japan's Exports Face Dual Pressure From Hormuz Strait Closure and Tourism Slowdown

According to Daiwa Securities economist Kento Minami on May 19, Japan’s exports will face downward pressure despite robust growth reported in first-quarter GDP data. The closure of the Hormuz Strait will directly pressure exports to the Middle East, while domestic supply constraints are expected to dampen overall goods exports. Separately, inbound tourism—a component of export figures—has already slowed due to fewer visitors and is likely to weaken further amid rising fuel surcharges.