President Trump has said that the U.S. could levy tariffs on Japan as high as “30%, 35% or whatever the number is that we determine” as trade talks between the two nations stall. “I doubt it with Japan, they’re very tough,” said Trump regarding a deal.
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The latest tariff threat is a jump above Trump’s original reciprocal tariff rate of 24% for Japan announced on April 2. Japan could face its new, higher rate if it is unable to strike a trade deal by July 9, which is just eight days away.
U.S-Japan Trade Talks Stall
Earlier today, Japanese chief cabinet secretary Yoshimasa Hayashi said “We are not thinking about doing anything that would sacrifice the farm sector.” That comes after Trump accused the “spoiled” country of rejecting U.S. rice imports amid a massive rice shortage. However, the U.S. accounted for about 75% of tariffed rice imported to Japan in May.
In 2024, the U.S. exported $79.4 billion of goods to Japan and imported $148.2 billion of goods from Japan, resulting in a goods trade deficit of $68.5 billion.
The iShares MSCI Japan ETF (EWJ) is falling lower on Tuesday as investors grapple with the potential for an even higher tariff rate.
