The Bank of Japan has revised its growth forecast for the fiscal year beginning April 1 to 0.5 percent from an earlier prediction of 1.1 percent. This downgrade comes in light of global economic challenges attributed to U.S. tariffs, particularly affecting Japan's export-driven economy. The announcement coincides with the decision to keep interest rates unchanged at 0.5 percent. The looming threat of higher tariffs on Japanese exports, especially in the automotive sector, raises concerns about a potential crisis if negotiations do not lead to lower rates.
The Bank of Japan downgraded its growth forecast to 0.5 percent due to trade policies and U.S. tariffs impacting economic prospects domestically and abroad.
President Trump's tariff threats are significantly weighing on economic prospects around the world, leading to a revised lower growth outlook for Japan and other economies.
Tariffs on imports, like a proposed 25 percent on cars, are already pressuring Japanâs economy, which heavily relies on exporting products to the U.S.
The Prime Minister of Japan has warned that potential higher tariffs could lead to a national crisis if not negotiated down, further straining economic stability.
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