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Investing.com -- In a recent meeting with Japanese trade officials, U.S. tariff negotiators displayed a reluctance to lower tariffs on cars, steel, and aluminum, as reported by the Nikkei newspaper on Friday.
The Japanese side interpreted this stance as an indication of potential difficulties in cooperating. The U.S. tariff negotiators also included Treasury Secretary Scott Bessent.
The meeting, which took place in Washington on Thursday, involved U.S. negotiators presenting a proposed framework for a trade agreement to Japan’s top trade negotiator, Ryosei Akazawa, and other Japanese officials.
While discussing the trade agreement, the Japanese representatives outlined measures that Japan could take to reduce its significant trade surplus with the U.S.
Accordingly, these measures included reviewing non-tariff barriers on auto imports and increasing the purchase of U.S. agricultural goods.
On Thursday, the Bank of Japan downgraded its growth forecast for the current fiscal year, projecting the economy will expand by just 0.5%, a significant cut from the 1.1% growth it anticipated in January.
BOJ Governor Kazuo Ueda attributed the revision to the United States’ “unprecedented level” of tariffs, which he warned are weighing on global growth and threatening Japanese corporate profits.
Speaking at a briefing in Tokyo, Ueda said the trade measures pose a broad risk to overseas demand and Japan’s export-driven economy.
The updated outlook came as the Bank of Japan announced it would hold its benchmark interest rate steady at 0.5% in an effort to maintain stability amid mounting external headwinds.