Morgan Stanley MUFG: U.S. tariffs pose risk to Japan’s economy | Forexlive

Economists at Morgan Stanley MUFG Securities warn that the new U.S. tariffs on Japanese imports could put downward pressure on Japan’s economy, particularly if they remain in place for an extended period. Trump has notified Japan of a 25% tariff effective August 1 — up from 24% in April — if no new trade deal is reached.

The firm notes that sustained high tariffs would likely hurt Japanese exports and dampen capital investment. However, they also point to the possibility of new fiscal stimulus, with a support package potentially unveiled in autumn during an extraordinary session of Japan’s Diet following the Upper House election.