Trump’s Tariff Twist: Canada and Mexico Get a Break, China Doesn’t
In a dramatic turn of events, President Donald Trump announced a temporary pause on Trump Canada tariffs following a high-stakes meeting with Prime Minister Justin Trudeau. The decision, which also includes Mexico, comes after weeks of escalating trade tensions and market chaos. But there’s a catch: China isn’t off the hook, with new tariffs set to hit Beijing next week.
“We’ve reached a fair deal with Canada and Mexico,” Trump declared at a press conference, flanked by Trudeau and Mexican President Claudia Sheinbaum. “But China? They’re not playing by the rules, and they’ll pay the price” . The announcement sent the Dow Jones Industrial Average soaring 450 points, while the S&P 500 hit a 2025 high .
Trudeau-Trump Meeting: A Diplomatic Win for Canada
The Trudeau-Trump meeting—held at the White House on February 3—was a masterclass in diplomacy. Trudeau, known for his calm demeanor, reportedly pushed back against Trump’s initial tariff threats, emphasizing the economic toll on both nations. “We’re not just neighbors; we’re partners,” Trudeau said during the joint press conference .
Key outcomes from the meeting:
- A 90-day pause on Trump Canada tariffs, including levies on auto parts and aluminum .
- A commitment to renegotiate cross-border trade agreements, with a focus on supply chain resilience.
- A pledge to address labor and environmental standards in future deals .
“This is a win for Canadian workers and businesses,” Trudeau tweeted after the meeting, sparking a wave of relief across industries .
Markets React: Dow Soars, Ford Stock Rebounds
The tariff pause sent shockwaves through global markets. The Dow Jones Industrial Average surged 1.4%, while the S&P 500 climbed 1.2%—its best single-day gain since January . Canadian stocks also rallied, with Ford stock (a major player in cross-border auto trade) jumping 5% .
But not everyone’s celebrating. Analysts warn that the Trump Canada tariffs could resurface if negotiations stall. “This is a temporary reprieve, not a resolution,” cautioned RBC economist Nathan Janzen .
Also Read: USD/CAD Rollercoaster: Loonie Plunges to 22-Year Low Before Tariff Deal Rescue!
China Left Out: New Tariffs Loom as Trade War Escalates
While Canada and Mexico breathe a sigh of relief, China is bracing for impact. Trump confirmed that new tariffs on Chinese goods—ranging from electronics to textiles—will take effect February 10. The move, which targets $200 billion worth of imports, could escalate the ongoing U.S.-China trade war .
“China’s been taking advantage of us for decades,” Trump said. “It’s time to level the playing field” . Beijing has yet to respond, but experts predict retaliatory measures could follow .
Also Read: Canada Slaps 25% Tariffs on US Goods: Trade War Explodes
What’s Next for Canada and the U.S.?
The tariff pause buys time, but the road ahead is rocky. Key issues to watch:
- CBSA (Canada Border Services Agency) preparations for potential tariff reinstatement .
- Ongoing negotiations between Trudeau and Trump, with the next round set for March .
- The impact of U.S. tariffs on American banks in Canada, which face higher operational costs .
“This isn’t over,” warned one Ottawa insider. “Tariffs are Trump’s favorite bargaining chip, and he’s not afraid to use them” .
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