US and Mexico Reach Agreement to Delay Tariffs
US President Donald Trump has delayed tariffs on Mexican goods by one month, following an agreement with Mexican President Claudia Sheinbaum. The tariffs, initially set to take effect on Tuesday, were imposed by Trump to address concerns over illegal immigration and drug smuggling. However, economists warned that the tariffs could lead to a trade war, increased prices for US consumers, and higher unemployment.
As part of the agreement, Mexico has agreed to send 10,000 soldiers to the US-Mexico border to combat the flow of fentanyl and illegal migrants. The US has also committed to working with Mexico to address arms trafficking. This move is seen as a significant step in addressing the security concerns that have been a major point of contention between the two countries.
The delay provides a temporary reprieve for Texas, which relies heavily on trade with Mexico. The state’s economy could have been severely impacted by the tariffs, particularly in the energy and agriculture sectors. The tariffs would have also had a significant impact on the automotive industry, which relies heavily on cross-border trade.
The decision to delay the tariffs has been met with a mix of reactions. Some have praised the move, saying it will give the two countries time to work out a more comprehensive agreement. Others have criticized the decision, saying it does not address the underlying issues and could lead to further uncertainty.
It’s worth noting that the tariffs on Canada and China are still set to go into effect. Trump has said he will be speaking with Canadian Prime Minister Justin Trudeau to discuss the issue. The tariffs on Canada are expected to have a significant impact on the country’s economy, particularly in the steel and aluminum sectors.
The ongoing trade tensions between the US and its trading partners have had a significant impact on the global economy. The tariffs have led to increased prices for consumers, reduced economic growth, and increased uncertainty for businesses. The delay in the tariffs on Mexico provides a temporary reprieve, but the ongoing tensions between the US and its trading partners remain a major concern.
In the coming weeks and months, it’s expected that there will be intense negotiations between the US and its trading partners. The outcome of these negotiations will have a significant impact on the global economy and the future of international trade. As the situation continues to evolve, it’s clear that the ongoing trade tensions will remain a major focus for policymakers, businesses, and consumers around the world.
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Trump Delays Mexico Tariffs By One Month
By Diccon HyattDiccon Hyatt is an experienced financial and economics reporter who has covered the pandemic-era economy in hundreds of stories over the past two years. He’s written hundreds of stories breaking down complex financial topics in plainspoken language, emphasizing the impact that economic currents would have on individuals’ finances and the market. He’s also worked at U.S. 1, Community News Service and the Middletown Transcript.
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Published February 03, 2025 11:08 AM EST
US President Donald Trump speaks to the press upon arrival at Joint Base Andrews in Maryland on February 2, 2025, as he returns to the White House from Florida.
Jim Watson /AFP via Getty ImagesA looming trade war between the U.S. and its top trading partners took a step back Monday when President Donald Trump said tariffs against Mexico won’t go into effect for another month.
Trump and Mexican President Claudia Sheinbaum announced the delay on social media two days after Trump ordered 25% tariffs against goods from Mexico and Canada, and a 10% tariff against Chinese products, which were set to go into effect Tuesday.
The Canada and China tariffs were still set to go into effect as of Monday morning.
Trump had said he was imposing tariffs to stop illegal immigration and drug smuggling, boost American manufacturing, and raise revenue in place of the income tax. Economists have warned the tariffs could lead to a trade war, raise prices for U.S. consumers, and cause higher unemployment should they actually go into effect.
Many Wall Street forecasters have assumed the tariff threats were mainly negotiating tactics and would ultimately not be implemented.
Source: Investopedia
