In a surprising turn of events, President Donald Trump has decided to pause the new 25% tariffs set to begin Tuesday on goods entering the United States from Mexico. The decision comes after Mexican President Claudia Sheinbaum agreed to deploy 10,000 soldiers to the country’s border, specifically to combat the trafficking of fentanyl and other drugs into the U.S.
This move has provided a boost to U.S. markets. After opening lower on Monday, stocks regained some of their losses following the announcement of the tariff pause. The delay, lasting for at least a month, signals a temporary easing of trade tensions between the two countries, which had been at the center of economic uncertainty.
The pause gives both nations time to assess progress on the border security measures, with the potential for further negotiations to address ongoing concerns around drug trafficking and immigration. Investors, relieved by the reduction in trade tensions, are closely watching for updates on the situation as markets continue to react.