Japan's trade balance swung to a deficit of 406.9 billion yen in June 2026, reversing from a surplus of 122.3 billion yen a year earlier and far exceeding market expectations of a 120 billion yen gap. Exports surged 19.3% year-on-year to a three-month high of 10,929.0 billion yen, the strongest growth since November 2022, while imports jumped 25.4% to a record 11,335.9 billion yen, marking the fastest expansion since November 2022. The Nikkei 225 Index rose 2% to above 67,000 and the broader Topix Index gained 1% to 4,055, while the yen weakened beyond 163 per dollar, its lowest since October 1986, keeping markets on alert for possible government intervention.