The Bank of Japan reported Thursday that U.S. tariffs have had only a limited impact so far on Japanese exports and factory output. However, many firms fear the measures could erode global demand over time.
A summary of the BOJ’s quarterly meeting with regional managers showed some businesses have delayed investment plans, while others are spending more to improve efficiency and address labor shortages.
“Overall, the impact has been limited,” the BOJ noted, though many regions cited worries about weakening demand due to higher U.S. prices and a global slowdown.
These findings, based on regional surveys, don’t yet include President Trump’s recent announcement to raise tariffs on Japanese goods to 25% unless a trade deal is reached by August 1.
In a separate report, the BOJ maintained its view that all nine regional economies are recovering moderately. The bank will consider these assessments at its July 30–31 policy meeting, when it will release new growth and inflation forecasts.
Company outlooks on wages and prices were mixed. Some firms plan to cut bonuses if tariffs squeeze profits, while others intend to keep raising pay to secure workers. Though many businesses expect to increase prices to offset higher costs, some are holding back as consumers grow more cautious.