President Donald Trump has announced a one-month delay on the 25% tariffs originally planned for many imports from Mexico and some from Canada. The White House maintains that the tariffs are aimed at curbing fentanyl smuggling, but they have strained North American trade relations and caused stock market instability. Trump insists that addressing the trade deficit could resolve the issue and confirmed that most of the tariffs will take effect on April 2.
Under the orders signed by Trump, imports from Mexico that comply with the 2020 USMCA trade agreement will be temporarily exempt from the tariffs. Auto-related imports from Canada that meet USMCA requirements will also avoid the 25% tariff for a month, while potash imports from Canada will face a 10% tariff. A White House official stated that around 62% of Canadian imports and half of Mexican imports that do not meet USMCA standards will still be taxed under the new tariffs.
Mexican President Claudia Sheinbaum plans to announce any retaliatory measures on Sunday. Trump credited Sheinbaum for progress on illegal immigration and drug enforcement, citing it as a reason for delaying the tariffs. Trump stated on Truth Social that he values the strong relationship with Mexico and cooperation on border security. Meanwhile, Canada has suspended its planned second wave of retaliatory tariffs, worth $87 billion USD, following Trump’s temporary delay.
The tariffs have unsettled financial markets and consumer confidence, leading to concerns about hiring and investment. The S&P 500 index fell below its level before Trump was elected. Commerce Secretary Howard Lutnick confirmed the tariff delay on CNBC, briefly lifting markets before declines resumed. When asked about the stock market downturn, Trump dismissed concerns, stating that the U.S. is reclaiming economic advantages that had been lost over the years.
Relations between the U.S. and Canada remain tense. A conversation between Trump and Canadian Prime Minister Justin Trudeau reportedly turned heated over trade policies, particularly regarding Canada’s dairy protections. Ontario Premier Doug Ford announced a 25% increase in electricity rates for 1.5 million American customers in response to the tariffs, affecting states such as Minnesota, New York, and Michigan. Ford’s office indicated that the tariff on electricity would remain in place as long as the U.S. tariff threat persists.
