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By Jesus Mesa and Gabe Whisnant
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President Donald Trump announced Thursday that he is postponing 25 percent tariffs on most Mexican imports for one month following a conversation with Mexico's president.
The decision comes after Commerce Secretary Howard Lutnick indicated that tariffs on both Mexico and Canada would "likely" be delayed.
Why It Matters
This marks the second time Trump has postponed the tariffs since first unveiling them in early February. The temporary reprieve applies to goods that comply with the trade agreement Trump negotiated with Canada and Mexico during his first term.
Read More on U.S.
Trump's on-again, off-again tariffs threats have roiled financial markets, lowered consumer confidence, and enveloped many businesses in an uncertain atmosphere that could delay hiring and investment.
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What To Know
In a post on Truth Social, Trump framed the tariff suspension as a sign of "respect" for Sheinbaum and praised Mexico's commitment to working with the U.S. on border security and drug trafficking.
"After speaking with President Claudia Sheinbaum of Mexico, I have agreed that Mexico will not be required to pay tariffs on anything that falls under the USMCA Agreement," Trump said, emphasizing their collaborative efforts to curb illegal migration and the flow of fentanyl.
"I did this as an accommodation, and out of respect for President Sheinbaum. Our relationship has been very good," he added.
In response, Sheinbaum thanked Trump, calling their conversation "excellent and respectful."
"Many thanks to President Donald Trump. We had an excellent and respectful call in which we agreed that our collaboration has yielded unprecedented results, while respecting our sovereignties. We will continue working together, particularly on migration and security issues, including reducing the illegal crossing of fentanyl into the U.S. and weapons into Mexico."
While Mexico received a tariff exemption, Canada was notably absent from Trump's announcement. Canadian Prime Minister Justin Trudeau expressed concerns over the trade measures, stating that his government is considering delaying retaliatory tariffs on the U.S., but has not ruled out maintaining them.
"We will not suspend Canadian tariffs because the Americans made a change yesterday," Trudeau said, adding, "We will not back down from our response tariffs until the unjustified American tariffs on Canadian goods are lifted."
Trump accused Trudeau of using the trade dispute for political leverage. "Believe it or not, despite the terrible job he's done for Canada, I think Justin Trudeau is using the tariff problem, which he has largely caused, to run for Prime Minister again," Trump wrote on Truth Social.
Commerce Secretary Lutnick estimated that more than half of U.S. imports from Mexico and Canada would qualify for the exemption. "For companies with products that comply with the trade agreement, you will get a reprieve from the tariffs now," he said in an interview with CNBC**.**
What People Are Saying
President Donald Trump on Truth Social: "After speaking with President Claudia Sheinbaum of Mexico, I have agreed that Mexico will not be required to pay tariffs on anything under the USMCA Agreement. This agreement lasts until April 2. I did this as an accommodation and out of respect for President Sheinbaum. Our relationship has been very good, and we are working hard together on the border—both to stop illegal immigration and fentanyl. Thank you to President Sheinbaum for your hard work and cooperation!"
President Claudia Sheinbaum on X (formerly Twitter): "Thank you to President Donald Trump. We had an excellent and respectful call in which we agreed that our collaboration has yielded unprecedented results while respecting our sovereignties. We will continue working together, particularly on migration and security issues, including reducing the illegal crossing of fentanyl into the U.S. and weapons into Mexico. As President Trump mentioned, Mexico will not be required to pay tariffs on USMCA-covered products. This agreement lasts until April 2, when the U.S. will announce reciprocal tariffs for all countries."
Commerce Secretary Howard Lutnick on CNBC: "As mentioned by President Trump, Mexico will not be required to pay tariffs on products under the USMCA. This agreement lasts until April 2, when the U.S. will announce reciprocal tariffs for all countries."
Douglas Irwin, Economist at Dartmouth College, to The Associated Press: "Past trade agreements simply don't mean much if the president can unilaterally violate them and impose tariffs with no checks at all."
What Happens Next
Lutnick emphasized that reciprocal tariffs, where the U.S. applies import taxes on countries that tax U.S. exports, will still be implemented on April 2. U.S. markets rebounded shortly after Lutnick's comments.
This is a developing news story and will be updated as more information is available.
Reporting by The Associated Press contributed to this article.
Update: 3/6/25, 1:17 p.m. ET: This article has been updated with new information.
Update: 3/6/25, 12:57 p.m. ET: This article has been updated with new information.
Update: 3/6/25, 12:14 p.m. ET: This article has been updated with comments from Claudia Sheinbaum.
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