EDIT: Upon further thought, I realized that the Edo period began only a few decades after matchlocks were introduced to Japan. Since the country was unified and isolated, armor became mostly ceremonial and was used to display wealth and nobility rather than for actual usage in combat, meaning that there was no real need to develop protective gear against bullets.
Was that the case, or is my guess wrong?
In Europe and in Japan, armor was not abandoned in the 16th century because guns were not good enough to penetrate them (the best sets anyway) and there were still considerable close-quarter fighting.
But yes, Japan's isolation and lack of wars meant Japanese firearms didn't develop further, so armour was kept.
One of the military reforms in the Bakumatsu and Meiji was to get up-to-date guns and get rid of the armour