Trump Vows New Tariffs on Mexico, Canada and China

FILE PHOTO: US President-elect Donald Trump attends a viewing of the launch of the sixth test flight of the SpaceX Starship rocket, in Brownsville, Texas, US, November 19, 2024. Brandon Bell/Pool via REUTERS/File Photo
FILE PHOTO: US President-elect Donald Trump attends a viewing of the launch of the sixth test flight of the SpaceX Starship rocket, in Brownsville, Texas, US, November 19, 2024. Brandon Bell/Pool via REUTERS/File Photo
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Trump Vows New Tariffs on Mexico, Canada and China

FILE PHOTO: US President-elect Donald Trump attends a viewing of the launch of the sixth test flight of the SpaceX Starship rocket, in Brownsville, Texas, US, November 19, 2024. Brandon Bell/Pool via REUTERS/File Photo
FILE PHOTO: US President-elect Donald Trump attends a viewing of the launch of the sixth test flight of the SpaceX Starship rocket, in Brownsville, Texas, US, November 19, 2024. Brandon Bell/Pool via REUTERS/File Photo

US President-elect Donald Trump vowed on Monday to impose sweeping new tariffs on Mexico, Canada and China as soon as he takes office as part of his effort to crack down on illegal immigration and drugs.

He said he would impose a 25% tax on all products entering the country from Canada and Mexico, and an additional 10% tariff on goods from China, as one of his first executive orders.

In a series of posts to his Truth Social account, Trump vowed to hit some of the United States' largest trading partners with duties on all goods entering the country.

“On January 20th, as one of my many first Executive Orders, I will sign all necessary documents to charge Mexico and Canada a 25% tariff on ALL products coming into the United States,” he wrote, according to AFP.

He said the new tariffs would remain in place “until such time as Drugs, in particular Fentanyl, and all Illegal Aliens stop this Invasion of our Country!”

The President ignored the US, Mexico and Canada three-decade-old free trade agreement, now called the USMCA.

In another post, Trump said he would also be slapping China with a 10% tariff, “above any additional Tariffs,” in response to what he said was its failure to tackle fentanyl smuggling.

“No one will win a trade war,” Liu Pengyu, a spokesman for China's embassy in the United States, told AFP by email, defending Beijing's efforts to curb fentanyl smuggling.

“China believes that China-US economic and trade cooperation is mutually beneficial in nature,” Liu added.

Canada said it was “essential” to US energy supplies, and insisted the relationship benefits American workers.

“We will of course continue to discuss these issues with the incoming administration,” said the statement from Deputy Prime Minister Chrystia Freeland.

Tariffs are a key part of Trump's economic agenda, with the Republican vowing wide-ranging duties on allies and adversaries alike while he was on the campaign trail.

Many economists have warned that tariffs would hurt growth and push up inflation, since they are primarily paid by importers bringing the goods into the US, who often pass those costs on to consumers.

But those in Trump's inner circle have insisted that the tariffs are a useful bargaining chip for the US to push its trading partners to agree to more favorable terms, and to bring back manufacturing jobs from overseas.



Gold Extends Slide to 1-week Low on Curbed Safety Demand, Stronger Dollar

A view shows an ingot of 99.99 percent pure gold in a workroom during production at Krastsvetmet precious metals plant in the Siberian city of Krasnoyarsk, Russia, May 23, 2024. REUTERS/Alexander Manzyuk/File Photo
A view shows an ingot of 99.99 percent pure gold in a workroom during production at Krastsvetmet precious metals plant in the Siberian city of Krasnoyarsk, Russia, May 23, 2024. REUTERS/Alexander Manzyuk/File Photo
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Gold Extends Slide to 1-week Low on Curbed Safety Demand, Stronger Dollar

A view shows an ingot of 99.99 percent pure gold in a workroom during production at Krastsvetmet precious metals plant in the Siberian city of Krasnoyarsk, Russia, May 23, 2024. REUTERS/Alexander Manzyuk/File Photo
A view shows an ingot of 99.99 percent pure gold in a workroom during production at Krastsvetmet precious metals plant in the Siberian city of Krasnoyarsk, Russia, May 23, 2024. REUTERS/Alexander Manzyuk/File Photo

Gold prices extended declines on Tuesday, hitting a more than one-week low, pressured by a jump in US dollar and easing safe-haven demand after reports of a possible Lebanon-Israel ceasefire.

Spot gold was down 0.4% at $2,614.56 per ounce as of 0845 GMT, after hitting its lowest since Nov. 18 earlier in the session. US gold futures edged 0.1% lower to $2,614.80, Reuters reported.

The precious metal fell 3.2% on Monday, its deepest one-day decline in more than five months, on news that Israel looked set to approve a US plan for a ceasefire with the Iran-backed Hezbollah, with further pressure from Trump's nomination of Scott Bessent as the US Treasury secretary.

Meanwhile, the Kremlin said it had noted that Trump's circle was speaking about a potential peace plan for Ukraine.

"This has reduced the geopolitical risk premium, leading to a decline in gold prices," said Soni Kumari, a commodity strategist at ANZ, adding that a stronger US dollar is also weighing on investor appetite for gold. The dollar was up by 0.3%, after US President-elect Donald Trump vowed tariffs against Mexico, Canada and China, reducing gold's appeal for holders of other currencies.

"So now the focus will shift back to, what Fed is going to do in December meeting," Kumari said. Federal Reserve Bank of Minneapolis President Neel Kashkari, typically on the hawkish end of the US central bank's policy spectrum, said he is open to cutting rates again next month.

Traders will also keep a close eye on US consumer confidence data and the minutes from the Fed's November meeting later in the day.

"I expect gold to trade in a narrow range in the short term, with a slight upward drift," Matt Simpson, a senior analyst at City Index said.

Spot silver slipped by 0.1% to $2,614.80 per ounce, platinum shed 1.1% to $928.40 and palladium was down 0.2% to $971.10.