Reuters: Japan's Industrial Output Growth Plummets, U.S. Tariff Threats Pressure Economy
Reuters, June 30 report, Japan's industrial output in May increased by only 0.5% on a monthly basis, far below the market's expected increase of 3.5%. Manufacturers expect a slight increase of 0.3% in June output, but a decrease of 0.7% in July; The Japanese government is urgently seeking an exemption from the 25% tariff on its automotive industry from the United States. If no agreement is reached by July 9, it will also face a 24% "reciprocal tariff." An official from the Ministry of Economy, Trade and Industry warned that this move would severely impact the manufacturing sector and threaten Japan's fragile economic recovery - the country's first-quarter GDP had already shown a contraction for the first time in a year. Japanese policymakers are concerned that weak external demand combined with the tariff impact will make efforts to raise interest rates and reduce the balance sheet more complex.
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