Larry Kudlow expects Japan trade deal by end of month

May 3 (UPI) -- White House economic adviser Larry Kudlow said Friday "it's possible" for a trade deal with Japan to be ironed out by the end of May.

He made the comment while speaking to reporters who asked if an agreement could be in place when President Donald Trump travels to Japan May 25.

"It's possible," Kudlow said. "We're hard at it."

Trump welcomed Japanese Prime Minister Shinzo Abe to the White House last week to talk about a variety of security and economic issues, including trade.

"We have a very big trade negotiation going on right now with Japan," Trump told reporters during the Oval Office meeting April 26.

"We'll be discussing very strongly agriculture because as the PM knows Japan puts very massively tariffs on our agriculture," he added. "We don't tariff their cars so I think it's something we'll work out."

Washington and Tokyo's attempts to iron out a new trade deal comes more than a year after Trump withdrew the United States from the Trans-Pacific Partnership, which was signed by 11 countries. Trump said the deal would kill U.S. jobs.

Earlier in the day, Kudlow said he believes the Federal Reserve will be looking into cutting its benchmark interest rates.

"With these low inflation numbers, I think the Fed is actually looking at rate cuts, ... some of which were priced into the market maybe up until a few days ago," he told Fox Business.

On Wednesday, the Fed voted to keep the rates unchanged between 2.24 percent and 2.5 percent, despite a request from Trump to lower the rates. The Fed it based its decision a "strong" labor market and "solid" economic activity.

"The Fed is independent. I'm not going to outguess their timing. They are going to do what they want to do on their own time," Kudlow said.

"What I'll say is, again, using the analysis, what we found is that all these incentives in the economy, creating strong growth in jobs, with no inflation, and the Fed is looking at the inflation numbers and I don't think they are inclined to fine tun real [gross domestic product,]" he added.

"I think they are inclined to think ... low inflation might suggest the need for lower interest rates."