Once again, the bluff has been called.
Earlier this week, Trump said the tariffs on Canada and Mexico would go ahead and now he has pushed them back another month.
The tell was yesterday when Mexico’s Cheinbaum didn’t sound the least bit concerned.
Trump made the announcement about 45 minutes ago in the Oval Office following his cabinet meeting. The White House has still floated 25% reciprocal tariffs but those aren’t real risks to Canada and Mexico as the vast majority of trade is already tariff free.
In any case, it was always a bluff and the limited market reaction (USD/CAD down 30 pips) shows that they aren’t being taken overly seriously.
There was also some contraction in what Trump said. He was asked about the tariffs and first said they’re going ahead.
“I’m not stopping the tariffs,” Trump said while lamenting mistreatment by Canada and Mexico. Later though, he said the tariffs would be implemented April 2.
The April 2 date is also the date the White House has floated for reciprocal tariffs.
Another contradiction was around fentanyl with Trump saying conditions to lift the tariffs were “going to be hard to satisfy” in time for next week’s tariffs.