Japan's Top Trade Envoy Heads To Washington Again As July Deal Moves To Next Stage

Japan's top trade negotiator Ryosei Akazawa departed for Washington on Thursday for ministerial talks on the July trade deal, saying lower-level discussions had concluded and both sides agreed to implement the accord“faithfully and swiftly.” 

The visit follows his abrupt cancellation of a U.S. trip last week, which fueled speculation that friction was delaying the implementation of both tariff cuts and a planned $550 billion investment initiative, Bloomberg reported.

Autos remain central to Tokyo, which is pressing the U.S. to follow through on its pledge to reduce car tariffs and fold a separate longstanding 2.5% levy into a new 15% rate as outlined in the July 22 agreement. 

Akazawa reiterated Japan's expectation that U.S. President Donald Trump will issue an executive order to formalize the cuts before he returns to Japan on Saturday, though it is unclear which U.S. officials he will meet.

On agriculture, Akazawa again rejected reports that Japan had agreed to tariff cuts or expanded quotas beyond existing caps. He said Tokyo would handle U.S. requests to boost rice purchases within its current duty-free ceiling, denying any compromise that would“sacrifice agriculture.” 

Japan imported 346,000 metric tons of American rice last year out of 770,000 tons under its duty-free quota, and Washington has said the deal requires an immediate 75% increase in U.S. imports, which would cut into shipments from suppliers such as Thailand, Australia and China.

While Tokyo seeks auto tariff relief, Washington is pressing for proof of Japan's promised investment flows into U.S. manufacturing, with details of the $550 billion initiative still unclear.

On Stocktwits, retail sentiment was 'bullish' with 'normal' message volume for the SPDR S & P 500 ETF Trust (SPY) and 'high' volume for the iShares MSCI Japan ETF (EWJ), while sentiment for the Invesco QQQ Trust (QQQ) was 'bearish' with 'normal' volume.

So far this year, SPY is up 10.5% and QQQ has gained 11.8%, while EWJ has outperformed with a 17% rise.

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