Latest news with #MakikoYamazaki
Yahoo
6 days ago
- Business
- Yahoo
Japan cuts growth forecast on US tariffs drag, weaker consumption
By Makiko Yamazaki TOKYO (Reuters) -Japan's government cut its growth forecast for this fiscal year on Thursday as U.S. tariffs slow capital expenditure and persistent inflation weighs on private consumption, threatening a fragile economic recovery. In revised estimates presented at a meeting of Japan's top economic council, the government cut its inflation-adjusted gross domestic product growth forecast for the year ending in March 2026 to 0.7% from 1.2% projected in January. The new forecast, still above private-sector forecasts for 0.5% growth, reflects worries that U.S. tariffs will make Japanese companies more cautious about capital expenditures and drag down exports, both key drivers of Japan's economic growth. The outlook for private consumption, which accounts for more than half of Japan's economy, was also lowered as inflation continues to squeeze households. The private-sector members of the economic council warned that inflation could further dampen consumer spending if it accelerates. "The Bank of Japan should pursue its price stability mission and sustainably and stably meet it's 2% inflation target," the members said. For the next fiscal year from April, the government projected growth to pick up slightly to 0.9%, retaining its view the economy will sustain a domestic demand-led recovery as it predicts wage growth will outpace inflation and boost private consumption. The government maintained its outlook for delivering a primary budget surplus in fiscal 2026 for the first time in decades, predicting even a larger surplus of 3.6 trillion yen ($24.39 billion) thanks to higher tax revenues. The primary budget balance, which excludes new bond sales and debt-servicing costs, is a key gauge of the extent to which policy measures can be funded without resorting to debt. But the rosy outlook has not factored in potential tax cuts and cash handouts that the government has been considering amid growing pressure from the opposition for more aggressive spending to ease rising living costs. Prime Minister Shigeru Ishiba's grip on power has been further weakened by a bruising defeat for his ruling coalition this month in upper house elections after having lost its lower house majority last October. ($1 = 147.5900 yen)
The Star
05-08-2025
- Business
- The Star
Japan's Shibaura classified as core to national security amid takeover battle
FILE PHOTO: A person holds Japan's national flags in Tokyo, Japan, January 2, 2020. REUTERS/Kim Kyung-Hoon/File Photo TOKYO (Reuters) -Japan's Shibaura Electronics, a technology manufacturer at the centre of a $630 million takeover battle, has been formally classified as core to national security, a finance ministry list of such firms showed. The thermistor maker received an unsolicited takeover bid from Taiwanese components supplier Yageo in February and called on compatriot components maker Minebea Mitsumi to submit a competing bid. Shibaura was previously not among those designated as significant to the economy or security, meaning a would-be buyer was not obligated to notify the government prior to any deal. The new classification is unlikely to affect the course of the deal as Yageo protectively filed for a security review based on its own analyses that some of Shibaura's businesses may fall under the core category. Nearly a fourth of about 4,000 listed Japanese firms are classified as core in the finance ministry list, last updated on July 15. Shibaura representatives were not immediately available for comment. The bidding battle has become a test of Japan's openness to unsolicited takeovers. Stigma around such offers has eased recently yet unsolicited bids from foreign firms remain rare. Yageo, the world's largest maker of chip resistors, is awaiting the outcome of the security review under the Foreign Exchange and Foreign Trade Act, which has been extended twice. The classification list is based mainly on company responses to ministry questions. It is the foreign suitor's responsibility to judge whether a potential deal requires a security review, the ministry said. Last year, Seven & i Holdings changed its self-reported national security classification to core when it was fending off a $46 billion bid from Canada's Alimentation Couche-Tard. The retailer said the change was unrelated to the approach, which was unlikely to be affected by the designation. ($1 = 147.1100 yen) (Reporting by Makiko Yamazaki; Editing by Christopher Cushing)
Time of India
27-07-2025
- Business
- Time of India
Japan says $550 billion package in trade deal could finance Taiwanese chipmaker in US
By Makiko Yamazaki TOKYO: Japan's $550 billion investment package agreed in this week's U.S. tariff deal could help finance a Taiwanese firm building semiconductor plants in the U.S., Japan's top trade negotiator Ryosei Akazawa said on Saturday. Japan agreed to the sweeping U.S.-bound investment initiative, which includes equity, loans and guarantees, in exchange for lower tariffs on its exports to the U.S. However, the structure of the scheme remains unclear. "Japan, the United States, and like-minded countries are working together to build supply chains in sectors critical to economic security ," Akazawa told public broadcaster NHK. To that end, he said projects eligible for financing under the package are not limited to U.S. or Japanese firms. "For example, if a Taiwanese chipmaker builds a plant in the U.S. and uses Japanese components or tailors its products to meet Japanese needs, that's fine too," he said, without specifying companies. The U.S. is significantly reliant on Taiwan's TSMC for advanced chip manufacturing, raising economic security concerns due to geographic proximity to China. TSMC announced plans for a $100 billion U.S. investment with U.S. President Donald Trump at the White House in March, on top of $65 billion pledged for three plants in the state of Arizona, one of which is up and running. Japan will use state-owned Japan Bank for International Cooperation (JBIC) and Nippon Export and Investment Insurance (NEXI) for the investments. A recent law revision has enabled JBIC to finance foreign companies deemed critical to Japan's supply chains. Akazawa told NHK that equity investment would account for just about 1-2% of the $550 billion, suggesting that the bulk will come in the form of loans and guarantees. When asked about the White House statement that the U.S. would retain 90% of the profits from the package, he clarified that the figure refers only to returns on equity investment, which would represent a small fraction of the total. While Japan initially hoped to secure half of the returns, a loss from the concession on the profit-sharing would be marginal compared to the roughly 10 trillion yen ($67.72 billion) in tariff costs that could be avoided under the deal, he said. He added that Japan aims to deploy the $550 billion investments during Trump's current term.
Yahoo
17-07-2025
- Automotive
- Yahoo
Japan exports down for second straight month, weighed by US tariffs
By Makiko Yamazaki TOKYO (Reuters) - Japan's exports fell for a second straight month in June, data showed on Thursday, underscoring the mounting strain that sweeping U.S. tariffs are placing on the country's fragile economy. Japan failed to clinch a deal with the U.S. before the July 9 expiration of the temporary pause on the country-specific tariffs after it focused on eliminating the existing sectoral 25% tariffs on automobiles, a mainstay of the export-reliant economy. Washington now plans to impose tariffs of 25% on Japanese imports, unless a trade deal is struck by August 1. Total exports by value dropped 0.5% year-on-year in June, data showed, compared with a median market forecast for a 0.5% increase and a 1.7% decrease in May, the first drop in eight months. Exports to the United States fell 11.4% in June from a year earlier, while those to China were down 4.7%, the data showed. Total imports grew 0.2% in June from a year earlier, compared with market forecasts for a 1.6% drop. As a result, the trade balance stood at a surplus of 153.1 billion yen ($1.03 billion), compared with a forecast for a surplus of 353.9 billion yen. U.S. tariffs are adding to pressure on the Japanese economy which is struggling due to lacklustre domestic consumption. Japan's economy shrank in the first quarter as rising living costs hurt demand. So far, Japanese automakers have avoided major price hikes in the U.S. by cutting prices on exported cars and absorbing tariff costs to stay competitive while sacrificing profits. Japan exported 21 trillion yen worth of goods to the United States last year, with automobiles representing roughly 28% of the total. Prolonged uncertainties over the impact of the tariffs and the course of trade negotiations will likely force the Bank of Japan to keep focusing on downside risks to the economy and to put rate hikes on hold for the time being, analysts say. ($1 = 148.0000 yen) ($1 = 148.0600 yen) Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
18-06-2025
- Business
- Yahoo
Japan exports post first drop in 8 months as US tariffs hit autos
By Makiko Yamazaki TOKYO (Reuters) -Japan's exports fell for the first time in eight months in May, data showed on Wednesday, indicating that sweeping U.S. tariffs were threatening the country's fragile economic recovery. Japanese Prime Minister Shigeru Ishiba and U.S. President Donald Trump have yet to reach a trade deal. Tokyo is scrambling to find ways to get Washington to exempt its automakers from 25% automobile industry-specific tariffs, which are dealing a heavy blow to the country's manufacturing sector. It also faces a 24% 'reciprocal' tariff rate starting in July 9 unless it can negotiate a deal with Washington. Total exports by value dropped 1.7% year-on-year in May, data showed, smaller than a median market forecast for a 3.8% decrease and following a 2% rise in April. Exports to the United States plunged 11.1% last month from a year earlier, while those to China were down 8.8%, the data showed. The tariff threat had driven companies in Japan and other major Asian exporters to ramp up shipments earlier this year, inflating levels of U.S.-bound exports during that period. The data showed imports dropped 7.7% in May from a year earlier, compared with market forecasts for a 6.7% decrease. As a result, Japan ran a trade deficit of 637.6 billion yen ($4.39 billion) last month, compared with the forecast of a deficit of 892.9 billion yen. The hit from U.S. tariffs could derail Japan's lacklustre economic recovery. Subdued private consumption already caused the world's fourth-largest economy to shrink in January-March, the first contraction in a year. They also complicate the Bank of Japan's task of raising still-low interest rates and reducing a balance sheet that has ballooned to roughly the size of Japan's economy. The BOJ kept interest rates steady on Tuesday and decided to decelerate the pace of its balance sheet drawdown next year, signalling its preference to move cautiously in removing remnants of its massive, decade-long stimulus. According to an estimate by the Japan Research Institute, if all the threatened tariff measures against Japan were to take effect, U.S.-bound exports will fall by 20-30%. Some economists say those duties could shave around 1 percentage points of the nation's gross domestic product. Japan exported 21 trillion yen worth of goods to the United States last year, with automobiles representing roughly 28% of the total. . ($1 = 145.3400 yen) Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
