Stocks and cryptocurrency plummeted over the weekend as the economy began to brace for impact ahead of Trump’s tariffs. The Dow dropped nearly 1,000 points between Friday afternoon and Monday morning, while the value of Bitcoin fell by $13,000.
The sharp drop came after Trump announced last week that he would impose 25% tariffs on both Mexico and Canada. Mexican president Claudia Sheinbaum was swift to issue retaliatory tariffs in response. Meanwhile, Canadian Prime Minister Justin Trudeau publicly warned Americans of the hit their economic wellbeing would take as manufacturers pulled some US made products off shelves.
Just one day before the the tariffs were set to go into effect, Trump issued a major reversal. Following a phone call with President Sheinbaum, Trump announced he is pausing the start of US tariffs for a month.
On a post from Truth Social, Trump claimed Sheinbaum agreed to send 10,000 Mexican troops to the US/Mexico border. Trump said he plans to use the month as an opportunity to “negotiate” with the Mexican government.
“I look forward to participating in those negotiations, with President Sheinbaum, as we attempt to achieve a “deal” between our two Countries,” he wrote.
Trump pauses tariffs on Mexico, Canada hours before they were set to go into effect
Late on Monday afternoon, Trump announced he was also pausing the tariffs to go into effect at midnight on all imports from Canada. Trump called Prime Minister Trudeau twice during the day to come to an agreement.
The United States imports nearly half a trillion dollars of goods from Canada each year. Oil, automobile parts, plastics and metals are among the most traded goods. Should tariffs go into effect after the pause, Americans would likely see significant price hikes on gasoline, car sales and repairs, and more.
Trump continues to mention annexing Canada, one of America’s greatest allies, as a way to avoid tariffs. His ongoing attacks on the northern country are seemingly beginning to wear on the nerves of Canadians. Over the weekend, boos erupted during the singing of the US National Anthem at an NHL game in Ottawa. Many in the country are pledging to intentionally “buy Canadian”, boycotting products from the states.
Last week, after announcing the tariffs he promised during his campaign, Trump warned that Americans would feel economic “pain” and “pay a price”, but that it would be “worth it”. Those in the lower and middle class are likely to experience the most hardship.
“WE WILL MAKE AMERICA GREAT AGAIN, AND IT WILL ALL BE WORTH THE PRICE THAT MUST BE PAID,” Trump wrote in all capital letters on Truth Social.
“WE ARE A COUNTRY THAT IS NOW BEING RUN WITH COMMON SENSE — AND THE RESULTS WILL BE SPECTACULAR!!!”