U.S. President Donald Trump looks on as he signs an executive order in the Oval Office at the White House in Washington, U.S., Jan. 31, 2025.
Carlos Barria | Reuters
U.S. President Donald Trump is pushing ahead with long-threatened import tariffs on goods from Canada, Mexico and China.
On Saturday, Trump signed an order imposing 25% tariffs on imports from Mexico and Canada, as well as a 10% duty on China. Energy resources from Canada will have a lower 10% tariff.
Together, the U.S. does about $1.6 trillion in annual business with the three countries. Trump is seeking to use the tariffs as both bargaining chips and methods to effect foreign policy changes, specifically the immigration and drug trade issues.
There is no official metric on when the tariffs will be lifted. There order does include a retaliation clause should any country choose to retaliate in any way, with the signal being to take further action likely by increasing tariffs.
The tariffs are expected to take effect on Tuesday.
Tariffs are duties imposed on foreign goods that are paid by U.S. importers. Economists broadly oppose tariffs, arguing that they result in higher prices for domestic consumers.
But Trump has long promoted tariffs as a way to negotiate better deals with U.S. trading partners, protect domestic industries from foreign competition and gain revenue.
In the Oval Office on Friday, Trump said his decision to slap tariffs on goods from Canada, Mexico and China is “pure economic.”
He referenced U.S. trade deficits with the three nations, but also pointed to fentanyl, accusing all three of being complicit in the deadly opioid’s spread in the U.S.
However, economists worry they could reignite inflation at a time when it appears price pressures are beginning to abate. The Commerce Department reported Friday that an inflation reading closely watched by the Federal Reserve rose to 2.6% in December, but the details in the report appeared more positive. Fed officials have said they are monitoring the impact of fiscal policy.
Trump has vowed to impose new or additional tariffs on numerous other categories of foreign goods, including microchips, oil and gas, steel, aluminum, copper and pharmaceuticals, including “all forms of medicine.” He has also said he will “absolutely” slap tariffs on the European Union.
—CNBC’s Kevin Breuninger and Jeff Cox contributed reporting.
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