Japanese Prime Minister Shigeru Ishiba said that Japan won’t make major concessions or rush a deal in upcoming tariff negotiations with the U.S.
Despite being a close ally, Japan faces a 10% universal tariff and a painful 25% duty on car exports — a major concern since automobiles make up 28% of Japan’s exports to the U.S. While some of President Trump’s tariffs are paused for 90 days, negotiations starting Thursday in Washington will cover tariffs, non-tariff barriers, and currency issues.
Ishiba emphasized a careful approach: “We shouldn't make big concessions just to finish talks quickly,” he said, though he ruled out retaliatory tariffs.
Bank of Japan Governor Kazuo Ueda warned U.S. tariffs could hurt both Japanese and global economies. Trump has also accused Japan of keeping the yen artificially weak, prompting speculation that Tokyo may face pressure to let its currency strengthen.
Economy Minister Ryosei Akazawa will lead the Japanese delegation, with currency discussions to be handled separately by Finance Minister Katsunobu Kato and U.S. Treasury Secretary Scott Bessent. Kato said both countries aim to avoid excessive market volatility.
Analysts say if the yen strengthens to 130/USD, the BOJ may pause rate hikes; if it weakens past 160, hikes could accelerate. The yen was at 143/USD on Monday.
Amid economic strain from tariffs and a weaker yen, Japanese lawmakers are urging the government to provide tax relief or cash payouts. While Ishiba ruled out an immediate budget boost, he said the government stands ready to act if needed.