Japan and the United States have struck a major trade deal in which Japan will invest $550 billion into the US economy. In return, the US will significantly reduce tariffs on Japanese automobiles and auto parts, with no volume restrictions. This news caused Japan’s Nikkei stock index to surge to a one-year high, led by gains in major car manufacturers like Honda, Toyota, and Mazda.
Japanese Prime Minister Shigeru Ishiba highlighted Japan’s leadership in reducing auto tariffs, while US President Donald Trump praised the deal as fair and beneficial for both countries. Japan will also open its market to more US goods, including agricultural products like rice. However, analysts remain skeptical about a significant increase in US car sales in Japan, citing long-standing structural issues such as vehicle size and fuel efficiency.
Japanese media celebrated the deal as a diplomatic win, especially as the US continues trade negotiations with other major partners like China, the EU, and Mexico.
(This video summary was created using AI. A journalist edited it before publication.)