Name: Trump pauses tariffs on Canada and Mexico in exchange for ramped up border security
Uploaded: 2025-02-04T14:42:05.000Z
Duration: 7 min 48 s
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President Trump now pumping the brakes on a trade war, pausing tariffs on both Canada and Mexico for at least 30 days in exchange for both countries beefing up U.S. security on their borders.

Now the big question right now, what happens with China?

The massive tariffs on that country are still set to go into effect tomorrow, watch.

We have meetings planned and we'll see what happens, but that was just an opening salvo.

If we can't make a deal with China, then the tariffs will be very, very substantial.

And a dramatic back and forth leading to a rollercoaster day on Wall Street.

The stock market closing in the red in just the last hour.

The Dow rebounding from steep declines earlier, but leaving global markets in turmoil.

Massive implications on the global stage and possibly for your wallet too.

The president says Americans could feel some short-term pain, soaking new inflation fears with higher prices possibly coming on fruits and vegetables, cars, gas, clothes, and electronics.

NBC's senior business correspondent, Christine Romans is standing by.

But let's start with Yamiche Alcindor who is near the White House.

So Yamiche, what do we know about this brand new 11th hour deal between the U.S. and Canada and what will the president be looking for after this 30 day pause?

Well, Ryan, this news is just breaking because President Trump just posted online.

He is confirming that the tariffs on Canada are gonna be paused it seems.

And he's listing a number of things that Canada is doing really as a concession in order to get these tariffs paused.

He said, Canada has agreed to ensure we have a secure northern border and to finally end the deadly scourge of drugs like fentanyl that have been pouring into our country, killing hundreds of thousands of Americans while destroying our families and communities all across our country.

He goes on to say, Canada will implement their $1.3 billion border plan as per Prime Minister Justin Trudeau.

So it sounds like he's saying it's his responsibility.

He also goes on to say, I'm very pleased with this initial outcome and the tariffs announced on Saturday will be paused for a 30 day period to see whether or not a final economic deal with Canada can be structured, fairness for all.

So that's President Trump just in the last few seconds here posting online, confirming that he's now going to be pausing the tariffs for Canada.

He also earlier confirmed that he's pausing the tariffs on Mexico for 30 days.

Both of those countries, both Canada and Mexico are saying that they're going to be sending personnel to the border, really giving in some ways what President Trump wanted to him.

In the case of Canada, which says that only about 1% of fentanyl comes through their borders, they're saying they're going to appoint a new fentanyl czar as well as list cartels as terrorists along with a number of other actions.

But all of this seems to be slowing down what was really an escalating trade war, Ryan.

Yeah, and let's talk about this, Yamiche, because it's a big question as to whether or not this is the beginning or the end.

And the President already himself suggesting that tariffs on the EU could come next to the European Union.

Could the White House target some other of these top trading partners soon?

President Trump has made it very clear that he sees tariffs as frankly a diplomatic tool to push and force countries to do things that he wants them to do.

So the fact that he's already invoking the European Union as being his next target in this shows that he might be putting new tariffs there at some point.

It also is interesting that he's saying in the next day or so he plans to talk to the President of China.

He's expecting, at least on Tuesday, they were supposed to go into effect 10% tariffs on China.

We don't know if those are going to be paused.

But it's going to be interesting to see how President Trump moves forward with this.

It's also very clear that the President just overall has been saying that America has been taking advantage of it and that he wants to use tariffs on a number of countries to make America, what he says, very strong and very rich.

All right, Yamiche Alcindor, outside the White House.

Let's bring in NBC's Christine Romans now for more on the financial impact for everyone's wallet.

So Christine, I'm sure it's been a whiplash day for you.

You think one minute you're bracing for these tariffs and now they're at least temporarily paused.

But we still have one on China that still looks as though it's going to be implemented.

Yeah, and these tariffs on Mexico and Canada are not off.

And the 10% tariffs on China are still there.

Remember, the Trump administration first started tariffs on China in his first administration.

And the Biden administration actually kept those and then added some other strategic tariffs on important tech products, you know?

So this has been territory with the U.S. and China for some time here.

So a pause for Mexico and Canada, but still an awful lot of confusion about what kind of cost this will have for businesses, what kind of uncertainty it keeps for businesses, and what the cost will be for American households.

I mean, you've got Trump tariffs, if they all go into effect, anywhere from $800 to $1,200 a year are some of the back of the envelope forecast that so many of these economists have been doing, Ryan.

Christine, I wonder, there's got to be some consequence to this yoking back and forth of the threat of tariffs.

I mean, if I'm a business owner, I'm trying to plan my fiscal year.

How do I brace for something like this, not knowing what the outcome could possibly be?

Look, uncertainty is kryptonite to anybody who runs a business or runs a household budget, for that matter.

So you're talking about the kinds of things that are imported from Canada, you know, oil.

Oil is imported from Canada, even though the U.S. is pumping record amounts of oil.

We are also still using oil from Canada. 40% of American fresh fruit and vegetables are coming from either Canada or Mexico.

So that is something that hits the grocery bill immediately.

And that Canadian crude I was telling you about, you know, that is refined in U.S. refineries that are geared specifically to that kind of heavy, Alberta crude, and then it's put into cars as gasoline, cars on U.S. roads.

So U.S. drivers would be facing 15 to 25 cents extra a gallon for gas.

If you start taxing, essentially taxing imported crude oil.

The president really talks about unleashing energy in the U.S., not having to rely on other countries for any of these products, frankly.

It's not something, it's not a switch you can flip overnight.

So near term, short term pain, the president said, acknowledged could happen.

And that's certainly what markets have been telling you.

And Christine, we know that the president likes to fashion himself as one of the great deal makers in American history.

It's clear he's using tariffs as a negotiation tactic.

Are there dangers, though, using tariffs in this form?

I mean, politically, for other politicians, probably yes.

Honestly, he is a one man focus group, right?

I mean, there's just no one else like him.

And I think these foreign leaders are taking him very seriously.

You saw Colombia back down and accept migrants after President Trump said he would use tariffs.

You've got Mexico now vowing to put 10,000 troops at the border and really make a renewed effort on fentanyl.

And even Canada, where fentanyl is not really a really market problem, even Canada will be spending lots and lots of money to have a czar for fentanyl and to try to stop the 40 pounds of fentanyl that has been seized from coming across the border.

He doesn't need a court to tell him he can do it.

So it's a negotiating tactic that he has at his disposal and he has employed it quite a bit here in the first two weeks of his administration.

Christine Romans, thank you so much for breaking it all down for us.

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