Trump Backs Off Tariff Threat With Canada And Mexico

President Donald Trump reached agreements with Mexico and Canada on Monday that will delay his threatened tariffs for one month, pausing the drama that roiled global markets and panicked businesses across the country.

Trump confirmed the one-month delays in posts on Truth Social. He said he granted the delays after Mexico agreed to send 10,000 soldiers to the U.S.-Mexico border and Canada promised additional actions to address Trump’s concerns about fentanyl flowing south into the United States.

Both pauses came after Trump spoke with Mexican President Claudia Sheinbaum and Canadian Prime Minister Justin Trudeau by phone, two days after he signed three executive orders imposing new 25 percent tariffs on Mexico and Canada and 10 percent tariffs on China.

Levies on Chinese goods are still scheduled to go into effect at midnight Monday. Trump is expected to speak with Chinese President Xi Jinping within the next day.

The move heads off what would have severely disrupted integrated supply chains that have built up for decades. The U.S. has had a free trade agreement with Canada and Mexico since 1994.

Trump said Secretary of State Marco Rubio, Secretary of Treasury Scott Bessent, and his choice for secretary of Commerce, Howard Lutnick, would meet with high-level Mexican representatives during the one-month pause for further negotiations.

“I look forward to participating in those negotiations, with President Sheinbaum, as we attempt to achieve a ‘deal’ between our two Countries,” Trump wrote.

Sheinbaum, in a post on X, said the troops at its northern border would target drug trafficking from Mexico to the US, particularly fentanyl.

Trudeau, in a similar post on X, said he detailed some new commitments in addition to the $1.3 billion border security plan they have already announced.

Those include appointing a “Fentanyl Czar,” listing cartels as terrorists, ensuring “24/7 eyes on the border,” and launching a Canada- U.S. Joint Strike Force to combat organized crime, fentanyl and money laundering.

“I have also signed a new intelligence directive on organized crime and fentanyl and we will be backing it with $200 million,” he added.

One person close to the administration, granted anonymity to discuss the rapidly evolving situation, said the tariff delay is what they had expected Trump to do all along, and that they had been surprised when the president announced on Friday that he was moving forward with the levies.

“All in all, predictable in Trump’s world,” said a former Mexican trade official, granted anonymity to discuss the politically sensitive talks. “Keep the sword of Damocles hanging.”

Financial markets dropped Monday morning in response to the Saturday executive orders.

Before the pause, Canadian Prime Minister Justin Trudeau had unveiled a list of more than $100 billion worth of American goods that will be subject to retaliatory tariffs starting Tuesday. At the same time Canadian officials said they were making good faith efforts to address border security concerns — and were bewildered at what more Trump wanted them to do.

“We're their number one export destination. We're their largest customers,” Ontario Premier Doug Ford told reporters Monday at a press conference in Etobicoke, Ont. “We aren't taking parts from China and putting made in Mexico stickers on, and shipping them through the United States. And there's precursors that are coming in from China going into Mexico. The fentanyl then gets run up through America into Canada. So we're no Mexico, I'll tell you that.”

Trump and Trudeau spoke Monday morning and are scheduled to speak again at 3 pm.

A person close to the administration, granted anonymity to discuss internal deliberations, said that they believe the moves over the weekend will accelerate the timeline for reviewing the United States–Mexico–Canada Agreement, known as the USMCA — which is due for a mandated review next year.

“Even with a deal or deals now, he will get another whack with USMCA negotiations, and the negotiators will now know that Trump isn’t afraid to tariff,” said the second person familiar with the discussions.

Sheinbaum seemed to acknowledge in her remarks on Monday that the upcoming review is inseparable from the current negotiations. “I am confident that these high-level working meetings between the U.S. and Mexican governments on security, migration, and trade will be important,” she said. “Trade discussions are particularly significant because, as you know, the trade agreement is up for review in 2026. But, if we start these dialogues now, it will help us a lot.”