President Donald Trump has decided to temporarily halt a proposed 25% tariff on goods entering the U.S. from Mexico following an agreement with Mexican President Claudia Sheinbaum. Sheinbaum committed to deploying 10,000 National Guard troops to the U.S.-Mexico border to combat illegal drug trafficking and migration.
Agreement Between the U.S. and Mexico
The agreement was reached after Trump announced the tariffs to increase pressure on Mexico regarding border security and drug trafficking. In response, Sheinbaum promised to deploy 10,000 National Guard troops to the border. The decision provides a one-month window for negotiations.
Impact on Financial and Cryptocurrency Markets
The tariff pause had a positive impact on financial markets, with U.S. stocks recovering most of their losses amid fears of a trade war. The S&P 500 index rebounded, and the Mexican peso stabilized. Meanwhile, the cryptocurrency market also showed improvement, as Bitcoin, which dropped to $91,178, rebounded to around $98,000.
Risks of the Temporary Decision
Despite the temporary halt, risks remain. Experts warn that while the decision provides short-term relief for markets, concerns persist about the tariffs to be imposed on Canada and China.
This temporary tariff halt provides room for negotiations but leaves uncertainties regarding future developments. The decision has significant economic implications despite ongoing risks.
