Optimism Fades in Japan Over U.S. Trade Policy

Confidence among manufacturers in Japan has declined for the first time in two years over worries about the global impact of U.S. protective tariffs, according to a Bank of Japan survey.

BoJ’s quarterly Tankan poll shows producers also are worried about rising commodity prices and the inability to pass them along to customers. Respondents predict worse conditions three months from now.

The index for Japanese carmakers is at 22 for current conditions but only 13 for the situation three months from now.

The Nikkei says some manufacturers fret over the consequences of U.S. tariffs imposed to shield American companies. One of the newspaper’s trade sources notes that the Trump administration’s new 25% tax on imported steel could produce a glut of Chinese-made steel, thereby depressing prices for Japanese steelmakers.

The chief financial officer for tiremaker Bridgestone Corp. says the U.S. tariff will raise the cost of steel cord it ships to its factories in the U.S. Observers note that an upward pressure on tire prices could adversely affect employment at the company’s U.S. facilities.