Japanese Bank Shares Plummet Amid Global Tariff Tensions

Japanese bank shares nosedived amid fears that U.S. tariffs may hinder global growth and jeopardize Japan's economic recovery. The Tokyo banking stocks index fell over 8%, eroding efforts to revive normal interest rates. Analysts point to U.S. economic ties and global trade recession concerns as key factors.

Shares of Japanese banks took a steep plunge on Friday as concerns mounted over the impact of U.S. tariffs on global growth, threatening Japan's tentative economic recovery. The Tokyo index of banking stocks fell over 8%, marking a week-long decline of 20% as fears of stunted growth and halted long-term financial strategies took hold.

Mitsubishi UFJ Financial Group, Japan's largest financial entity, saw its shares drop by 8.5%. As some of the world's biggest lenders by assets, the downturn underscored the ripple effects of U.S. President Donald Trump's protectionist measures and Japan's delicate economic shift away from deflation.

Japan's fourth-largest economy had shown signs of breaking a prolonged economic slump last year, as the Bank of Japan raised interest rates after nearly two decades. However, continued growth now hinges significantly on U.S. economic actions, crucial to Japanese automakers and industries, experts assert.

(With inputs from agencies.)