The report says that the two sides are in the final stages of talks to implement lower tariffs on Japanese auto imports within two weeks after the issuance of a US presidential executive order. The tariffs rate reduction will be lowered from the current 27.5% to 15% and is set to take effect by the end of September.

But for now, the exact date is yet to be confirmed as things are still under discussion with the final decision set to rest on none other than US president Trump. I think that final point can be a major sticking point.

If things play out positively, that will be a good boost for the yen as it does reduce the burden on the BOJ in pushing for rate hikes. But again, it’s all still tentative as we have to wait to see how Trump’s tariffs will play out in the appeal with the Supreme Court and then also how he feels about the arrangement with Japan on agriculture especially.