US trade deal still weighs on Japan’s inflation-hit economy

Experts in Tokyo say it is tough to assess if the risk of a slowdown has been removed, writes Kyodo

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The Japan-US trade deal provides only a brief relief, as tariffs remain at higher levels than before, threatening to hinder Japan's inflation-plagued economy from recovering, analysts say.

While Japan offered an increased US$550 billion (17.1 trillion baht) investment in the US market, according to a social media post by US President Donald Trump, worries remain about the impact of tariffs on Japanese businesses.

Shinichiro Kobayashi, principal economist at Mitsubishi UFJ Research and Consulting, said the deal is positive in the sense that uncertainty was removed for Japanese companies to make business plans.

But “the tariff rates have been raised significantly since President Trump took office, and the situation remains the same’ he said.

The increasing risk of a US economic slowdown means the agreement is not expected to guarantee a boost to Japan’s exports, Mr Kobayashi said.

Tariffs on steel and aluminium products remain at 50% and Mr Trump said he would impose a 50% tariff on copper imports and reiterated he will soon unleash sector-based duties, including some aimed at protecting the American pharmaceutical and semiconductor industries.