The new U.S.-Japan trade deal lowers tariffs and strengthens economic ties, helping challenge China's regional aggression and instability.

T he U.S. and Japan have reached a trade agreement under which the longtime U.S. will face a 15% tariff—down from a previously threatened 25%—President Donald Trump announced on Tuesday, as Japan’s Prime Minister hailed the move as a “new golden era” in the relationship between the two countries.

The U.S. and EU are close to reaching an agreement on a 15% tariff rate as part of a similar deal to the one agreed with Japan earlier this week, The Wall Street Journal reported Wednesday.

The deal reduces tariffs on Japanese exports, including autos and auto parts, to15 percent, in exchange for Japanese investment and import commitments.

Toyota has expressed optimism following the announcement of a new trade agreement between the United States and Japan.

The 15% tariff would be lower than previously threatened, but it would remain a high duty on America’s largest trading partner.