Rabo: Some Room Left?

Market comments

Some Room Left?

Market comments

Authored by Benjamin Picton

President Trump’s tariffs on Canada and Mexico, and an additional 10% tariff on imports from China took effect yesterday. Trump had said on Monday that there was “no room left” for those countries to negotiate on trade, but Commerce Secretary Howard Lutnick walked back the hawkishness late on Tuesday by suggesting that some wiggle room may exist to reduce duties on goods covered by the USMCA trade agreement. Earlier in the week Mexico floated a proposition to apply 25% tariffs to imports from China as a quid-pro-quo for continued US market access. Could we see a united trade front against China on the table as the Trump Administration’s price for watering down duties on Canada and Mexico?