Trump's Mexico Tariff Postponement and Market Changes
1. Mexico Tariff Issue
- Trump postponed the tariffs to be imposed on Mexico by one month.
- The Mexican government announced the tariff postponement first, but Trump ultimately confirmed it on his social media.
- The postponement of tariffs had a positive impact on the market, and the falling index partially recovered.
2. Stock Market Reaction
- The Nasdaq fell more than 1% at one point, but the decline narrowed due to news of the tariff postponement.
- The Dow Jones, S&P 500, and Russell all showed similar trends, closing with a slight decline.
- Overall, the stock market remains uncertain, but it is in a stable phase in the short term.
3. Agreement Between Trump and Mexico
- Mexico agreed to deploy 10,000 soldiers to the U.S. border.
- Mexico's main goal is to resolve violence within its country, while the U.S. aims to solve the problems of illegal immigration and drugs.
- The agreement between the two countries emphasized cooperation on the surface, but the priorities of both sides are different.
4. Economic Implications of Tariffs
- UBS and Goldman Sachs expect tariffs related to Mexico or Canada not to be sustained in the long term.
- The Trump administration is also cautious because tariffs could lead to increased inflation or slower growth in the U.S. economy.
5. Other Tariff Fronts
- In addition to the Mexico tariffs, Trump is considering imposing a 10% tariff on the European Union (EU).
- The possibility of boycotts of U.S. products in Europe and Canada is also expected to negatively affect the market.
6. Differences Between 2019 and 2025
- There were tariff policies in 2019, but inflation was low at the time.
- In 2025, high inflation could make trade uncertainty a bigger issue.
- The Federal Reserve's (FED) interest rate policy is also expected to be volatile considering this.
7. Impact on Major Industries and Stocks
- The auto union supports tariffs and reacts positively to the increase in factories in the U.S.
- On the other hand, there are movements to boycott U.S. products in Canada.
8. Expert Opinions
- Paul Tudor Jones assesses that the current financial market environment is more unstable than in 2017.
- He warns of the possibility of additional economic difficulties due to high national debt and an overvalued stock market.
9. Artificial Intelligence Development
- Despite the market turmoil caused by the tariff issue, OpenAI continues to innovate by releasing new technologies.
< Summary >
Trump's postponement of Mexico tariffs for one month had a positive impact on the market, but uncertainty remains.
Tariff issues affect the overall economy, and the U.S. economy has risk factors, especially due to the link between tariffs and inflation.
The market is likely to remain uncertain depending on the Fed's interest rate policy and changes in the international trade environment.
Tariffs have different effects on different industries, with a positive impact on workers in the U.S. but potentially negative impacts due to overseas backlash.
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