- We to avoid high -power arms trafficking to Mexico.
- Trump to participate in negotiations with President Sheinbaum.
- The surprise announcement relieves some pressure on the weight of Mexico.
Washington/Brussels: the president of the United States, Donald Trump, has stopped new rates in Mexico for a month after Mexico agreed to reinforce its northern border with 10,000 members of the National Guard to stop the flow of illegal drugs, particularly the fentanyl Said Monday.
The agreement also includes an EE. UU. American tariffs on Mexico, China and Canada were established. to enter into force.
The two countries will use the suspension of one month to participate in additional negotiations, Trump said.
“I hope to participate in these negotiations, with President Sheinbaum, while trying to achieve an” agreement “between our two countries,” he wrote about Truth Social.
“” We have this month to work and convince ourselves that this is the best way to follow, “Sheinbaum said at a press conference.
US actions, which had fallen abruptly on Monday morning for fear of a deeper commercial war, reduced their losses after the announcement. The reference point S&P 500 dropped 0.7% around 10:45 am et (1545 GMT), reducing its losses in the day to half.
The surprise announcement also relieved part of the pressure on the weight of Mexico.
Trump said Monday that he had talked to Canadian Prime Minister Justin Trudeau and that he would do it at 3pm ET (2000 GMT). Tariffs on Canada and China are still prepared to enter into force on Tuesday, and Canada has announced retaliation rates.
A senior Canadian official told a New York Times Reporter that Ottawa is not optimistic a similar relief is in sight, said the journalist in X.
Speaking in Washington on Sunday after returning from its Mar-A-Lago farm, Trump indicated that the European Union of 27 nations would be the next in the shot line, but did not say when.
“They do not take our cars, they do not take our agricultural products. They take almost anything and take everything,” he told reporters.
EU leaders gather at an informal summit in Brussels on Monday said Europe would be prepared to defend themselves if the United States imposes rates, but also requested reason and negotiation.
Upon arriving at the conversations, French president Emmanuel Macron said that if the EU was attacked in their commercial interests, it would have to “become respected and, therefore, react.”
Chancellor Olaf Scholz in Germany said the block could respond if necessary with his own tariffs against the United States, but emphasized that it was better for them to find an agreement on trade.
Trump hinted that Great Britain, who left the EU in 2020, could be tariffs and saying: “I think one can be resolved.”
The United States is the EU’s largest trade and investment partner. According to Eurostat data of 2023, the United States had a deficit of 155.8 billion euros ($ 161.6 billion) with the EU in the trade of goods, compensated by a surplus of 104 billion euros in services.
The EU Foreign Policy Chief Kaja Kallas said there were no winners in a commercial war, and if one exploded between Europe and the United States, “then the laugh on the side is China.”
The markets are fainted
Economists say that the republican president’s plan to impose 25% tariffs on Canada and Mexico and 10% rates on China would slow down global growth and raise prices for Americans.
Trump says they are necessary to stop immigration and narcotics traffic and stimulate national industries.
The reaction of the financial market on Monday reflected the concerns about the consequences of a commercial war. The shares in Tokyo ended the day it fell almost 3% and the reference point of Australia, often a proxy trade for Chinese markets, fell 1.8%. The continental China market was closed for New Year’s lunar vacations.
Around the time of lunch in Europe, the German Dax index decreased by 1.8%, the CAC of France decreased 1.9%and the FTSE 100 of Great Britain by 1.5%.
The Chinese yuano, the Canadian dollar and the Mexican peso collapsed against a dollar rising. With Canada and Mexico the main sources of us. Crude oil imports, US oil prices. CLC1 jumped more than 1%, while RBC1 gasoline futures increased almost 3%.
Trump tariffs cover almost half of all imports from the United States and would require the United States to double more than double their own manufacturing production to cover the gap, an unfeasible task in the short term, they wrote analysts ING.
Other analysts said that tariffs could throw Canada and Mexico into the recession and trigger “stagflation”: high inflation, stagnant growth and elevated unemployment, at home.
In Europe, Deutsche Bank economists said they were currently taking into account a 0.5% blow to the Gross Domestic Product (GDP) in case Trump imposes 10% tariffs in the block.
National emergency
An informative sheet of the White House did not give details about what Canada, Mexico and China would need to do a relief.
Trump promised to maintain the sanctions in place until what he described as a national emergency about fentanil, a deadly opioid and illegal immigration to the United States end.
China called Fentanyl America and said it would challenge tariffs in the World Trade Organization and take other countermeasures, but would also leave the door open for conversations.
Canada said it would take legal actions under relevant international organizations to challenge tariffs.
Automobile manufacturers would be particularly affected, with new tariffs in vehicles built in Canada and Mexico, carrying a vast regional supply chain where the pieces can cross borders several times before the final assembly. Ford FN and General Motors GM.N shares fell between 4% and 5%.
