Trump's Tariff Tussle: A Trade War Timeout

U.S. President Donald Trump temporarily paused tariffs on Mexico after Mexico pledged to reinforce its northern border. The agreement, aiming to tackle illegal drugs and weapon trafficking, allows for a month of further negotiations. Market reactions showed apprehension, with mixed impacts on various global indices.

U.S. President Donald Trump has paused new tariffs on Mexico for a month, following Mexico's agreement to deploy 10,000 National Guard members to its northern border to combat illegal drug flow. This accord, which includes U.S. efforts to prevent weapon trafficking to Mexico, was confirmed by Mexican President Claudia Sheinbaum on social media platform X.

The pause allows both nations to engage in further negotiations. "I look forward to participating in those negotiations," Trump said on Truth Social. The dialogue between Trump and Sheinbaum comes after Trump's tariff announcement involving key U.S. trading partners like Canada and China, causing significant market speculation.

Despite easing some tensions with Mexico, Trump's tariff plans for Canada and China are set to proceed, with Canada announcing retaliatory tariffs. Meanwhile, the European Union prepares to negotiate following Trump's suggestion of new tariffs targeting them. Economic experts argue these moves could slow global growth and impact economies, particularly Canada and Mexico's GDPs.

(With inputs from agencies.)