Trump expected to issue tariffs against Canada and Mexico starting March 1

• Trump expected to issue tariffs against Canada and Mexico starting March 1, according to sources familiar with the plan.
• Trump expected to announce a process for countries to seek exemptions for certain imports, sources say.
• US administration official says Trump is reviewing tariff plans, which may allow some exemptions, but they will be “few and far between.”

Note this is not confirmed by the administration. So caution is warranted.

Nevertheless if it is postponed, it gives countries time to negotiate a solution to border security, and the fentanyl concerns that the Trump administration has publicly said were issues. The third issue is the trade deficits.

The trade deficits will not be solved overnight and will likely lead to some tariffs at least down the road (whether they are blanket tariffs on all goods is up for debate).

I would NOT expect that Trump would back-off on tariffs especially as he sees them as a revenue source, was a campaign promise, and a way to squeeze US and foreign manufacturers to produce within the US borders.

The news has sent the USD lower.

• The USDCAD has moved to a low for the day at 1.4370 from around 1.4475 on the news.
• The EURUSD moved from 1.0391 to 1.0433.
• The GBPUSD has moved back above its 100 hour MA at 1.24402 and looks toward a swing area between 1.24739 and 1.24999 (call it 1.2500).

This article was written by Greg Michalowski at www.forexlive.com.