The Bank of Japan is expected to signal next week that risks from higher U.S. tariffs won't derail a cycle of rising wages and inflation seen as crucial to keep raising interest rates, Reuters reported. The assessment, to be included in its quarterly outlook report due on May 1, will underscore the BOJ's desire to keep alive market expectations of further interest rate hikes - even though the timing of its next move could be months away. "It's hard to predict the exact damage to the economy from (President Donald) Trump's tariffs at this stage," said one of the sources.
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The new U.S. ambassador to Japan arrived in Tokyo on Friday and said he is optimistic that his country and its key Asian ally will reach a deal in their ongoing tariff negotiations, the Associated Press reported. George Glass, a prominent businessperson known for his background in finance, investment banking and technology, arrives as Washington and Tokyo are negotiating President Donald Trump’s tariff measures, which have triggered worldwide concern about their impact on the economy and global trade. “I’m extremely optimistic ...
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Japan recorded a trade deficit in its March-April fiscal year but racked up a surplus with the U.S., the Finance Ministry reported Thursday, the Associated Press reported. Japan’s global trade deficit totaled 5.2 trillion yen ($37 billion) for the fiscal year through March, for the fourth straight year of deficits, according to the provisional statistics. The surplus with the U.S. ballooned to 9 trillion yen ($63 billion). Exports to the U.S. are a contentious issue for U.S. President Donald Trump and Japanese negotiators are in Washington to argue their case against higher U.S. tariffs.
Bank of Japan Governor Kazuo Ueda said the central bank may need to take policy action if U.S. tariffs hurt the Japanese economy, the Sankei newspaper reported on Wednesday, signaling the potential to pause the bank's rate-hike cycle. Since February, risks surrounding U.S. President Donald Trump's policies have "moved closer towards the bad scenario" the BOJ had envisioned, Ueda said in an interview, adding that recent developments have already affected corporate and household confidence.
The number of corporate bankruptcies in Japan in fiscal 2024 climbed 12.0% from the previous year to 10,144, topping 10,000 for the first time in 11 years, Tokyo Shoko Research said Tuesday. The annual figure rose for the third consecutive year, the Japan Times reported. The result reflected a surge in the number of bankruptcies due to labor shortages, particularly among small and midsize companies, and rising prices. The number of business failures linked to soaring labor costs and labor shortages increased 1.6 times to 309, the highest since fiscal 2013.
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Japan’s households cut back on spending as inflation remained elevated, in a sign of vulnerability in a key pocket of the economy before sweeping U.S. tariffs hit the country, Bloomberg News reported. Household outlays, adjusted for inflation, declined 0.5% in February from a year earlier, the internal affairs ministry reported Friday. The result compared with the median economist estimate of a 0.8% decline. The drop was led by falling outlays on clothes and footwear, housing and food.
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Japanese banks may need to offer business turnaround support to companies hit by tariffs imposed by the administration of U.S. President Donald Trump, the head of the country's banking lobby said, Reuters reported. Many large Japanese firms, including major exporters and manufacturers, are grappling with U.S. duties on imports of steel and aluminium and a 25% tariff on imported cars and light trucks starting this week. "We think tariffs could lead to a deterioration in corporate earnings," the new chair of the Japan Banks Association, Junichi Hanzawa, told Reuters in an interview.
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Japan, South Korea and China agreed on Sunday to continue trilateral economic and trade cooperation to address “emerging challenges,” a partnership that has become more crucial than ever as the U.S. trade war shatters the global order.
Trade minister Yoji Muto, his South Korean counterpart, Ahn Duk-geun, and Chinese Commerce Minister Wang Wentao met in Seoul for the first trilateral meeting among the three countries’ trade ministers in over five years, the Japan Times reported.
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Employees at major Japanese companies have been promised the biggest pay increases in 34 years. That’s a good sign for the economy, but forces smaller firms with smaller budgets to get creative to stay competitive in the labor market, the Wall Street Journal reported. Rather than raising base salaries, which can be costly enough to strain a company’s finances to the point of bankruptcy, small and medium-sized enterprises are looking at boosting benefits.
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