Japan said on Tuesday the trade agreement it struck with the U.S. cleared uncertainties on U.S. trade policies but continued attention needs to be given to risks of those policies putting downward pressure on the Japanese economy.

The US and the EU will have zero tariffs on aircraft and their components, some chemicals, some generic drugs, some semiconductors, some agricultural products and essential raw materials. Alcoholic beverages are not included in the agreement. The 50% tariffs on steel and aluminum remain.

The U.S. is significantly reliant on the Taiwanese company for advanced chip manufacturing, raising concerns due to its proximity to China.

Japan’s central bank policymakers are expected to keep rates on hold this week, despite the trade deal with the U.S. relieving some uncertainty over tariffs and strengthening the case for tighter policy.

The Bank of Japan (BOJ) is widely anticipated to keep its benchmark interest rate steady at 0.5% during its July 31 policy meeting, maintaining a hawkish tone amid persistent inflation and ongoing political and