In a surprise pivot, President Donald Trump dialed back his tariff threats Thursday, postponing 25% duties on USMCA-compliant goods from Mexico and Canada until April 2—a retreat from his economic shock-and-awe that’s sent stocks into a tailspin and businesses into a tailspin. The decision, inked via executive actions, followed a “respectful” call with Mexico’s Claudia Sheinbaum and rocky negotiations with Canada, spotlighting a rare moment of diplomacy in Trump’s trade war saga.
Trump framed it as a favor to Sheinbaum, lauding their border crackdown on Truth Social and hinting at relief for autos—a lifeline for carmakers facing a production overhaul that’s pure fantasy in 30 days. Sheinbaum, speaking to reporters, insisted most U.S.-Mexico trade is USMCA-shielded, though a White House source pegged it closer to 50% for Mexico and 36% for Canada, leaving gaps for items like avocados. Canada’s energy, meanwhile, keeps its 10% tariff, and potash got a last-minute cut to ease farmers’ pain.
Canada’s not playing nice—Trudeau’s holding firm on countermeasures, and Ontario’s Premier Doug Ford is set to zap U.S. power grids with tariffs next week, lamenting, “Let’s just ditch this and fix USMCA.” The Dow shed 427 points as Trump’s flip-flops fuel uncertainty; he shrugged off the dive, pinning it on “globalists” while admitting tariffs might sting. With Mexico, Canada, and China shipping $1.4 trillion in goods to the U.S. yearly, this pause is just a pit stop in a high-stakes economic showdown.