Trump eases Mexico, Canada tariffs again as markets slide

What happened

President Donald Trump Thursday suspended some of the 25% tariffs he imposed on Mexican and Canadian imports two days earlier. The one-month pause applies to imports that comply with the U.S.-Mexico-Canada trade pact he signed in his first term. Trump gave automakers a similar monthlong reprieve on Wednesday.

Who said what

Trump's "on-again, off-again tariff threats have roiled financial markets, lowered consumer confidence and enveloped many businesses in an uncertain atmosphere that could delay hiring and investment," The Associated Press said. Yesterday's pause did not calm the jittery markets — the S&P 500 dropped another 1.8%, leaving it "below where it was before Trump was elected."

The suspension "effectively abandons many of the tariffs" Trump just imposed on America's top two trading partners, The New York Times said, but it wasn't clear exactly how many. Mexican President Claudia Sheinbaum said "practically all of the trade" between the U.S. and Mexico was now duty-free again, while the White House said about half of Mexican imports and 38% of Canadian imports were compliant with the trade deal. Canadian Prime Minister Justin Trudeau said his country would "continue to be in a trade war that was launched by the United States for the foreseeable future." U.S. Treasury Secretary Scott Bessent called Trudeau a "numbskull."

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What next?

Canada said it would keep its 25% retaliatory tariffs in place regardless of Trump's pause, but not implement a second wave of taxes on U.S. imports. Ontario Premier Doug Ford said he would maintain his province's 25% surcharge on electricity exported to the U.S. until Trump "removes the threat of tariffs for good," and, along with other provinces, keep U.S. alcohol off Canadian shelves.