The main commercial negotiator of Japan, Ryosei Akazawa said Tuesday that he maintained a phone call with US Secretary of Commerce, Howard Lutnickfor 40 minutes. Akazawa added that he agreed to actively participate in commercial negotiations.
Outstanding comments
I maintain a phone call with the US Secretary of Commerce, Lutnick.
Japan has avoided easy commitments.
The conversation with Lutnick lasted 40 minutes.
I agreed with Lutnick to continue energetic negotiations.
We are negotiating with Japan’s national interest at stake, so we are not thinking of waiting until the elections of the upper house end.
I will not establish a deadline, including August 1, in negotiations with the US on trade.
The automotive sector is the core of Japan’s economy, the fact that 25% tariffs on cars and car parts are causing enormous losses to Japanese companies cannot be tolerated.
As for whether we could put something new on the negotiating table, my feeling is that we have already put all the necessary topics on the table.
It makes no sense to reach an agreement with the US without an agreement on automotive tariffs.
I am fully aware that commercial negotiations with the US will not be easy, since President Trump is ‘very hard’.
My work is to generate confidence through sincere negotiations with the US, try to find common terrain step by step and present a complete package of agreement as soon as possible.
I will not sacrifice the agricultural sector of Japan for the good of a commercial agreement with the US.
Market reaction
At the time of writing, the USD/JPY torque quotes 0.04% higher in the day to quote in 146.07.
Japanese – frequent questions
The Japanese Yen (JPY) is one of the most negotiated currencies in the world. Its value is determined in general by the march of the Japanese economy, but more specifically by the policy of the Bank of Japan, the differential between the yields of the Japanese and American bonds or the feeling of risk among the operators, among other factors.
One of the mandates of the Bank of Japan is the currency control, so its movements are key to the YEN. The BOJ has intervened directly in the currency markets sometimes, generally to lower the value of YEN, although it abstains often due to the political concerns of its main commercial partners. The current ultralaxy monetary policy of the BOJ, based on mass stimuli to the economy, has caused the depreciation of the Yen in front of its main monetary peers. This process has been more recently exacerbated due to a growing divergence of policies between the Bank of Japan and other main central banks, which have chosen to abruptly increase interest rates to fight against inflation levels of decades.
The position of the Bank of Japan to maintain an ultralaxa monetary policy has caused an increase in political divergence with other central banks, particularly with the US Federal Reserve. This favors the expansion of the differential between the American and Japanese bonds to 10 years, which favors the dollar against Yen.
The Japanese Yen is usually considered a safe shelter investment. This means that in times of tension in markets, investors are more likely to put their money in the Japanese currency due to their supposed reliability and stability. In turbulent times, the Yen is likely to be revalued in front of other currencies in which it is considered more risky to invest.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
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