Japan braced for increased pressure from President Donald Trump on defense spending, payments for U.S. troops and monetary policy as Washington approached the November 2026 midterm elections.
Japan Faces Higher US Troop Costs
Tokyo and Washington are expected to negotiate a new five-year agreement covering Japan’s financial support for U.S. forces beginning in fiscal 2027, Nikkei Asia reported on Tuesday.
Japan contributed more than 200 billion yen ($1.25 billion) in fiscal 2026, but a senior Defense Ministry official said Tokyo should be prepared for pressure to increase that amount.
"We should be prepared for some degree of demand for an increase," the official said.
Trump has previously argued that U.S. allies should shoulder more of their defense costs.
During his first term, his administration sought to more than quadruple Japan’s contribution, according to former U.S. national security adviser John Bolton.
Trump Pushes Japan on Defense and Yen
Washington also urged Japan to raise defense spending to 3.5% of GDP, compared with Tokyo’s current 2% target.
The pressure extends to currency policy. The U.S. and Japan recently coordinated yen-buying intervention as the Japanese currency weakened.
The Bank of Japan’s next policy meeting is scheduled for Sept. 17-18, with markets watching for another rate hike.
Trump Eyes New Kim Jong Un Summit
Trump has directed aides to explore a possible summit with North Korean leader Kim Jong Un as early as fall 2026, potentially during Trump’s November Asia trip for the APEC summit in China, the Wall Street Journal reported Tuesday.
On Monday, Trump said Kim had responded to his outreach and described the exchange as "very positive."
Trump also ordered the Pentagon to substantially scale back U.S.-South Korea military exercises, arguing they were costly and sent an "inappropriate and hostile" signal to North Korea.
He said his approach aimed to reduce tensions and make the situation safer, while adding that Kim had "always treated me with great respect."
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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