Trump agrees to pause tariffs on Canada for a month

By The Associated Press/WDIO

(AP Photo/Ben Curtis)

President Donald Trump on Monday held off on his tariff threats against Mexico and Canada for 30 days after the two U.S. neighbors agreed to boost border security efforts.

Trump on Saturday had directed that 25% tariffs on most imports from the two American partners — and 10% on Canadian energy products — go into effect at midnight Tuesday. The two nations threatened retaliation of their own, raising the prospects of a broader regional trade war.

In a statement on X, Canadian Prime Minister Justin Trudeau said that on a call with Trump he pledged additional cooperation on border security. It follows similar moves by Mexico earlier Monday.

“Proposed tariffs will be paused for at least 30 days while we work together,” Trudeau said.

Financial markets, businesses and consumers have been trying to prepare for the possibility of the new tariffs. Stock market indices opened with a modest selloff, suggesting some hope that the import taxes that could push up inflation and disrupt global trade and growth would be short-lived.

But the outlook reflected a deep uncertainty about a Republican president who has talked with adoration about tariffs, even saying the U.S. government made a mistake in 1913 by switching to income taxes as its primary revenue source. Trump said Sunday the tariffs would lift if Canada and Mexico did more to crack down on illegal immigration and fentanyl smuggling, though there are no clear benchmarks. Trump also said the U.S. can no longer run a trade imbalance with its two largest trade partners.

Mexico is facing a 25% tariff, while Canada would be charged 25% on its imports to the United States and 10% on its energy products. China is facing a 10% additional tariff due to its role in the making and selling of fentanyl, the Trump White House said.

Kevin Hassett, director of the White House National Economic Council, said Monday that it was misleading to characterize the showdown as a trade war despite the planned retaliations and risk of escalation.