(27 November 2024 – United States) The greenback jumped sharply following President-elect Trump’s announcement of a 25 percent tariff on Canadian and Mexican imports in conjunction with an additional ten percent tariff on Chinese imports.
As trade tensions intensify in the lead-up to President Trump’s inauguration, the USD appreciated by over two percent against the Mexican Peso and reached a four-year high against the Canadian “Loonie” Dollar.
The shift in policy is set to create significant global supply chain uncertainty and impose heavy costs on companies that rely on conducting business with the world’s largest economies. Imposing tariffs on Canada and Mexico violates the terms of the North American trade agreement that Mr. Trump himself signed in 2020, called the United States-Mexico-Canada Agreement.
Analysts warn that the proposed tariffs could disrupt trade balances regardless of a small opportunity for negotiations to ease rising market volatility amid expanded tariffs placed on Chinese “transshipment” goods routed through Latin America.
East & Partners September 2024 currency forecasts illustrate the value of customer insights as practical, measurable, and indispensable. In the fast-moving world of FX, the clearest signals often come from those living it firsthand.
“This Tariff will remain in effect until such time as Drugs, in particular Fentanyl, and all Illegal Aliens stop this Invasion of our Country!” the president-elect posted on Truth Social.
“Both Mexico and Canada have the absolute right and power to easily solve this long simmering problem. We hereby demand that they use this power, and until such time that they do, it is time for them to pay a very big price!”
“Representatives of China told me that they would institute their maximum penalty, that of death, for any drug dealers caught doing this but, unfortunately, they never followed through,” he said.