US President Donald Trump has accused Japan of manipulating its currency to benefit local manufacturers. However, Tokyo has denied these claims, stating that it is not pursuing a policy of currency depreciation.
According to the Japanese Finance Minister Katsunobu Kato, the country’s foreign exchange interventions demonstrate that it is not devaluing its currency. Instead, Japan needs to maintain good relations with major economies like the US, as it relies heavily on the security umbrella provided by Washington.
Trump has warned that if his demands are not met, he plans to impose retaliatory tariffs on Japanese goods. However, Tokyo appears unlikely to retaliate, given its dependence on US security and trade ties. The US tariffs on Canadian and Mexican imports, announced yesterday, suggest a broader trend of protectionism in the global economy.
The dispute between Washington and Tokyo highlights the challenges of navigating complex trade relationships and currency markets. Japan’s stance on this issue may ultimately depend on how it balances its economic interests with its need for US security cooperation.
Source: https://www.scmp.com/week-asia/politics/article/3301001/japan-rejects-trumps-accusation-devaluing-yen-amid-tariff-threat