Stop and go: Trump previously announced new tariffs of 25% on imports from Canada and Mexico, and 10% on imports from China. But while the tariffs on China are proceeding as planned, those on Canada and Mexico have been paused for a month.
Time to talk: In the case of Canada and Mexico, the pause will enable further negotiations aimed at allaying the White House’s concerns that America’s two neighbors aren’t doing enough to curb illegal immigration and drug trafficking across their respective boarders.
The pros and cons: While Trump views tariffs as an effective lever to force other countries to up their boarder protection game, economists caution they could have serious adverse effects on inflation, economic growth, and supply chain resilience.
Brace for impact: Hitting the “go” button on the Chinese tariff elicited an immediate retaliatory response, with Beijing announcing new targeted tariffs on U.S. exports. And brace yourselves: pundits, including JPMorgan’s chief China economist, are warning that economic tensions between the world’s two largest economies are only likely to escalate.
