Trump's Trade Strategy Shift: Delaying Tariff Decision for Broader Economic Review

Donald Trump plans to issue a trade memo that asks federal agencies to evaluate U.S. trade relationships with China, Canada, and Mexico. The memo doesn't immediately impose tariffs but scrutinizes unfair trade and currency policies. This shift sparked a global stock rally and affected currency markets.

On Monday, Donald Trump is set to release a comprehensive trade memo, advising federal agencies to extensively analyze U.S. trade dynamics with China, Canada, and Mexico. Unlike his earlier promises, Trump will not enact immediate tariffs, opting for a detailed examination of trade and currency practices instead.

This update eased widespread speculation around Trump's tariff plans, ultimately leading to a surge in global stock markets and a notable decline in the dollar against major currencies. Trump's earlier proposals included imposing hefty tariffs, particularly targeting imports from China, to address a substantial trade deficit exceeding $1 trillion annually.

Trade specialists believe that Trump's memo reflects a strategic realignment, directing agencies to investigate trade imbalances under existing legal frameworks like Section 232 and Section 301. These methods were previously employed to initiate tariffs during Trump's initial presidential term, affecting industries such as steel and aluminum.

(With inputs from agencies.)