BOJ Governor Warns US Tax Policy Risks Dragging Global Economy

BOJ Governor Warns US Tax Policy Risks Dragging Global Economy, Shocking Trade and Confidence Worldwide; Watch Out for IMF-G20 Meeting in Mid-Month as It Could Become a Hot Spot

April 2, 2568 at 09.30:XNUMX, Bloomberg reported that Kazuo Ueda, Governor of the Bank of Japan (BOJ) He said new US import tariffs could have a severe impact on global trade, warning that the impact could drag down global economic growth.

The warning comes ahead of President Donald Trump announcing new retaliatory tariffs on a range of imports, in addition to existing tariffs on steel and aluminum and on existing duties on Chinese goods. Trump has repeatedly threatened additional tariffs but has often canceled or postponed them.

Ueda said he wanted to discuss with G20 finance ministers and central bank governors at a meeting in Washington this month to exchange views on the impact of U.S. tax policy on the global economy.

Ueda told the Japanese parliament that “The impact of US tariffs on the global economy remains highly uncertain … but given the scope and scale of these measures, they could have a significant impact on trade between countries,”

He also pointed out that another key issue is how the tax measures will affect business and household confidence and spending. While higher taxes may push up inflation in the US in the short term, Ueda cautioned that in the long run, the effect could be counterproductive, as slower growth could put downward pressure on prices for goods and services.

The White House said the new retaliatory tariffs expected to be announced would go into effect immediately, including a 25% import tax on automobiles that would begin April 3, 2568.

Meanwhile, manufacturing activity indexes in several countries, including Japan, the UK and the US, slowed in March as businesses braced for new US tariffs, another key issue expected to be discussed at the IMF and G20 spring meetings.

Although the Bank of Japan has not confirmed whether Ueda will attend the G20 summit, the BOJ governor and Japanese finance minister are usually present at the summit.

Analysts say the impact of U.S. tariffs on Japan's economy will be a key factor in determining when the BOJ raises interest rates. The BOJ's next policy meeting is scheduled for April 30 to May 1. A Reuters poll showed that most economists expect the BOJ to raise rates in the third quarter of this year, with the most likely date in July.

refer : reuters.com

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