Japan's Exports Dip As Trump Tariff Threats Loom, Lutnick Signals Trade Deal Delay

Japan’s exports reportedly slowed down in the first 20 days of April amid a stronger yen, while U.S. tariffs on Japanese goods, from steel to cars, also came into effect.

Exports measured by value rose 2.3% from the same period a year earlier, according to a Bloomberg News report citing the Finance Ministry. That compares with a 4.2% gain in the first 20 days of March, and a 4.0% rise for that month.

Japan’s exports have increased in six consecutive months till March.

According to the report, citing a finance ministry official, autos, steel, and mineral fuels contributed most to the slowdown in export growth.

Hiroshi Miyazaki, a senior research fellow at Itochu Economic Research Institute, told Bloomberg that the impact of a stronger yen compared to a year ago likely explains the slowed increase in trade value.

U.S. President Donald Trump’s administration has imposed a 10% tariff rate on all exports in addition to 25% tariffs on steel, aluminum, and cars. However, if the two countries fail to reach an agreement before July, tariffs on all exports could rise to 24%.

While Thursday’s trade deal between the U.S. and the UK has set a potential framework for reprieve from sector-specific tariffs, the stakes are much higher for Japan to get a tariff exemption, as it is one of the top exporters of cars to the U.S.

Due to tariffs, the world’s largest car maker by sales, Toyota, has already forecast a 21% drop in operating in the fiscal year 2025-26.

Commerce Secretary Howard Lutnick said it could be a while before trade deals are signed with Japan and South Korea.

“You’ve got to spend an enormous amount of time with Japan, South Korea. These are not going to be fast deals,” Lutnick said to Bloomberg Television.

In March, Japanese real wages fell by 2.1%, fueling concerns about consumer spending. This decline, alongside export figures, could influence the Bank of Japan to take a more cautious approach to interest rate hikes.

The iShares MSCI Japan ETF (EWJ) has gained 6.9% this year compared to a 3.5% fall in the S&P 500 index.

Also See: Affirm Stock Dips After Weak Q4 Forecast, CFO Sees Growth Rate Moderating: Retail Pins Hopes On Long-Term Upside

For updates and corrections, email newsroom[at]stocktwits[dot]com.