Topline
The U.S. and Japan have reached a trade agreement that will lower tariff rates on the longtime U.S. ally down to 15%, President Donald Trump said Tuesday.
Trump announced the deal Tuesday evening. (Photo by Doug Mills-Pool/Getty Images)
Key Facts
The 25% tariff rate slated to hit Japan by August will be lowered to 15%, according to Trump, who said Japan will invest $550 billion into the U.S. under the deal.
Trump added Japan would “open their Country to Trade including Cars and Trucks, Rice and certain other Agricultural Products, and other things.”
The Nikkei, an index for the Tokyo Stock Exchange, jolted in its early minutes of trading, rising 2% by 9:30 a.m. JST.
Forbes has reached out to Japanese Prime Minister Shigeru Ishiba’s office for comment.
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Key Background
Trump threatened a 25% tariff rate against Japan this month as part of a series of letters sent to multiple countries informing them about their respective rates. Trump also threatened Japan with an even higher rate, saying, “If for any reason you decide to raise your Tariffs, then, whatever the number you choose to raise them by, will be added onto the 25% that we charge.” The president has repeatedly defended his tariff policies since unveiling rates in April, raising the ire of longtime trading partners and alarming experts who say the levies will raise consumer prices. A recent Yale University analysis published before the news of the Japan trade deal found Trump’s tariff policy could cost U.S. households an additional $2,400 this year if new copper and foreign goods tariffs become effective and stay in place.
Further Reading
Trump’s New Tariffs Could Cost Households $2,400 This Year, Analysis Finds (Forbes)