Japan is preparing for high-stakes trade talks with the United States, with currency policy expected to be a major point of contention. Prime Minister Shigeru Ishiba has launched a 37-member task force led by Economy Minister Ryosei Akazawa to steer negotiations. Akazawa is set to meet U.S. Trade Representative Jamieson Greer and Treasury Secretary Scott Bessent in Washington on April 17.
U.S. President Donald Trump has repeatedly criticized Japan for maintaining a weak yen, which he argues gives Japanese exporters an unfair edge. Markets anticipate Washington will push Tokyo to strengthen the yen and raise interest rates. Sources familiar with the matter confirm that U.S. officials are likely to focus on Japan’s monetary policy and the Bank of Japan’s slow pace in hiking rates.
Trump recently emphasized his interest in Japan’s currency stance during an April 7 phone call with Ishiba. Finance Minister Katsunobu Kato is also expected to visit Washington for G20 meetings, providing another opportunity for direct discussions with Bessent, who is known for his expertise in monetary policy.
Meanwhile, Japan is under growing domestic pressure to ease the economic impact of U.S. tariffs. Although Trump has temporarily reduced Japan’s reciprocal tariff rate to 10% for most goods, the 25% levy on auto imports remains. Tokyo may respond with a supplementary budget, cash payouts, and fuel subsidies, particularly ahead of July’s upper house election.
The ruling LDP-Komeito coalition is also considering a temporary sales tax cut on food to support consumers. With Ishiba’s approval ratings low, Japan’s economic response and negotiation outcomes could significantly influence the upcoming election and its broader economic trajectory.