3 days of tariff uncertainty doesn’t appear to have ‘secured any policy wins,’ Wolfe Research says
U.S. President Donald Trump speaks next to C.C. Wei, Chairman and CEO of TSMC and Commerce Secretary Howard Lutnick, as they make an announcement about an investment from Taiwan Semiconductor Manufacturing Company (TSMC), in the Roosevelt Room at the White House in Washington, D.C., U.S., March 3, 2025.
Leah Millis | Reuters
Heightened uncertainty around the Trump administration’s new tariffs has shaken markets in the past week, with all three major averages last pacing for a weekly decline.
But in a note from Thursday, Wolfe Research analyst Tobin Marcus criticized that all this uncertainty may have been for nothing.
“After three consecutive days of major tariff expansion or retraction, we have to ask: What was all this for? In Trump’s statement announcing the delay, he didn’t point to any specific further concessions from Sheinbaum on either fentanyl or trade, even though there are some policy shifts he might reasonably have hoped to achieve, as we noted on Monday,” he wrote. “Sheinbaum’s midday post also did not point to any specific policy commitments beyond general continued cooperation on migration, fentanyl, and guns.”
Marcus added: “Again, we’ll see as details continue to emerge, but for now it doesn’t look like these three days of tariffs and uncertainty secured any policy wins. And given what’s left behind after today’s more expansive relief, we’re not sure 25% tariffs on Canadian dairy products are going to make too much headway on drug trafficking.”
— Lisa Kailai Han
Claudia Sheinbaum Pardo, President of Mexico, discusses the one-month pause in the application of tariffs imposed on Mexico by the U.S. government during a briefing conference at National Palace. on February 2, 2025 in Mexico City, Mexico.
Luis Barron | Future Publishing | Getty Images
Mexican President Claudia Sheinbaum said Thursday that Mexico should be spared when U.S. reciprocal tariffs come into effect next month.
“What he has said is, [the U.S.] does not have tariffs on countries they import goods from. However, there are countries that have very high tariffs on U.S. products. He has said that’s not fair. Those are his words,” Sheinbaum said at a news conference. “In Mexico’s case, almost everything is without tariffs. We don’t charge them tariffs, and they don’t charge us tariffs.”
— Fred Imbert
US Secretary of Treasury Scott Bessent speaks at the Economic Club of New York on March 6, 2025.
Charly Triballeau | Afp | Getty Images
U.S. Treasury Secretary Scott Bessent took a verbal swipe at Canadian Prime Minister Justin Trudeau in the latest sign that negotiations between the two countries have not been going smoothly.
When discussing trade negotiations at an event for the Economic Club of New York, Bessent referred to the Canadian leader as a “numbskull.”
Trudeau and U.S. President Donald Trump spoke Wednesday in a call that Trump said ended on “somewhat” friendly terms. The Wall Street Journal, citing a person familiar with the matter, reported that the conversation had grown heated and included profanity.
— Jesse Pound
Mexico’s President Claudia Sheinbaum speaks during a press conference after holding a phone call with U.S. President Donald Trump, at the National Palace in Mexico City, Mexico March 6, 2025.
Henry Romero | Reuters
In reaction to Trump’s tariff pause, Mexican President Claudia Sheinbaum thanked the Republican and said she will continue to work with the White House on border security issues.
“Many thanks to President Donald Trump. We had an excellent and respectful call in which we agreed that our work and collaboration have yielded unprecedented results, within the framework of respect for our sovereignties,” Sheinbaum said in an X post. “We will continue to work together, particularly on migration and security issues, which include reducing the illegal crossing of fentanyl into the United States, as well as weapons into Mexico.”
— Yun Li
Cargo trucks remain in a parking lot, as some Mexican companies halt exports to the U.S., hoping for the tariffs to be reversed, in the outskirts of Ciudad Juarez, Mexico, March 5, 2025.
Jose Luis Gonzalez | Reuters
Trump said he will pause tariffs on Mexican goods that fall under the USMCA trade agreement until April 2.
“After speaking with President Claudia Sheinbaum of Mexico, I have agreed that Mexico will not be required to pay Tariffs on anything that falls under the USMCA Agreement,” Trump posted on Truth Social. “This Agreement is until April 2nd.”
Trump said he agreed to the exemption “out of respect” for Mexico President Claudia Sheinbaum. He did not mention Canada in the social media post.
— Spencer Kimball
US President Donald Trump (L) talks with Canada’s Prime Minister Justin Trudeau during the plenary session of the NATO summit at the Grove hotel in Watford, northeast of London on December 4, 2019.
Nicholas Kamm | AFP | Getty Images
Trump took another swipe at Trudeau, accusing the prime minister of leveraging the trade war for his own political benefit.
“Believe it or not, despite the terrible job he’s done for Canada, I think that Justin Trudeau is using the Tariff problem, which he has largely caused, in order to run again for Prime Minister,” Trump wrote on Truth Social.
“So much fun to watch!” the president added.
Trudeau announced in early January that he would step down as prime minister, citing “internal battles” in the government, as his Liberal Party appeared to be lagging behind its conservative rivals.
But since that announcement — and as Trump’s tariff threats on Canada came to fruition — the Liberals have surged in the polls.
Trudeau on Thursday morning denied he was considering staying on as a “caretaker PM” while Canada negotiates with the U.S.
“No, I will not be … I look forward to a transition to my duly elected successor in the coming days or week,” Trudeau said.
— Kevin Breuninger
Former US President Joe Biden (R) listens as US President Donald Trump (L) delivers remarks after being sworn in as the 47th president of the United States in an inauguration ceremony in the Rotunda of the United States Capitol on January 20, 2025 in Washington, DC. Donald Trump takes office for his second term as the 47th President of the United States.
Pool | Getty Images News | Getty Images
President Donald Trump blamed former President Joe Biden after the Commerce Department reported that the U.S. trade deficit hit a record high in January.
“Massive Trade Deficit with the World, just announced, compliments of Sleepy Joe Biden! I will change that!!!” Trump wrote on Truth Social.
The goods and services deficit for January surged more than $33 billion to a total of $131.4 billion, with imports soaring 10%.
Trump took office Jan. 20.
— Kevin Breuninger and Jeff Cox
Canadian and Mexican goods might only face reciprocal tariffs on April 2 if the two countries make progress on fighting fentanyl, Commerce Secretary Howard Lutnick suggested to CNBC.
“My expectation is the president will come to the agreement today that USMCA compliant goods will not have a tariff for the next month until April 2,” he said. The United States-Mexico-Canada Agreement is the trade deal Trump negotiated to replace NAFTA.
“Hopefully Mexico and Canada will have done a good enough job on fentanyl that this part of the conversation will be off the table and it will move just to the reciprocal tariff conversation,” Lutnick said.
Canada has forcefully rejected Trump’s accusations that fentanyl trafficking is a major problem at the northern border.
— Spencer Kimball
Canada’s Prime Minister Justin Trudeau speaks during a news conference about the US tariffs against Canada on March 4, 2025 on Parliament Hill in Ottawa, as Foreign Minister Melanie Joly (L) and Minister of Finance and Intergovernmental Affairs Dominic Leblanc look on.
Dave Chan | Afp | Getty Images
Canadian Prime Minister Justin Trudeau said his government was “having discussions” about possibly delaying a second wave of retaliatory tariffs against the U.S.
But he maintained that his country would be resolute in responding to the tariffs, and that they would not lift their countermeasures in response to the recent carve-outs announced by the Trump administration.
“We will not suspend Canadian tariffs because the American made a change yesterday,” he said. “As I said a number of times we will not be backing down from our response tariffs until such a time as the unjustified American tariffs on Canadian goods are lifted.”
Trudeau welcomed the possibility of more U.S. tariff exemptions, while emphasizing, “we are in a trade war.”
— Kevin Breuninger
U.S. President Donald Trump speaks, as he signs executive orders, while Howard Lutnick stands in the background, in the Oval Office of the White House in Washington, U.S., Feb. 10, 2025.
Kevin Lamarque | Reuters
Commerce Secretary Howard Lutnick said the stock market is not a motivating factor for the administration in this trade fight.
“The president wants American growth and American prosperity, OK? And the fact that the stock market goes down half a percent or percent, it goes up half a percent or percent, that is not the driving force of our outcomes,” Lutnick said on CNBC Thursday. “The president is focused on rebuilding America, and you are going to see growth in America. … You’re going to see interest rates drop 1% or more. You’re going to see the stock market explode.”
The stock market has been highly volatile as investors grappled with the uncertainty around tariffs and the tit-for-tat actions.
— Yun Li
Howard Lutnick, chief executive officer of Cantor Fitzgerald LP and US commerce secretary nominee for US President-elect Donald Trump, prior to a meeting with Senate Majority Leader Chuck Schumer, a Democrat from New York, not pictured, on Capitol Hill in Washington, DC, US, on Wednesday, Dec. 11, 2024.
Al Drago | Bloomberg | Getty Images
Commerce Secretary Howard Lutnick said all goods and services that are compliant with the USMCA trade agreement will likely be excluded from Trump’s tariffs for one month.
“It’s likely that it will cover all USMCA compliant goods and services, so that which is part of President Trump’s deal with Canada and Mexico are likely to get an exemption from these tariffs,” Lutnick told CNBC. “The reprieve is for one month,” he said.
The United States-Mexico-Canada Agreement is the trade deal Trump negotiated during his first term to replace the North American Free Trade Agreement.
— Spencer Kimball
Canada’s Prime Minister Justin Trudeau arrives for a news conference March 4, 2025 on Parliament Hill in Ottawa, Canada.
Dave Chan | Afp | Getty Images
Canadian Prime Minister Justin Trudeau said Ottawa will “continue to engage with our American counterparts” as it seeks to get Trump’s 25% duties lifted.
“Our goal remains to get these tariffs, all tariffs removed,” Trudeau said Thursday morning. “In the meantime, we’ll be taking action to support Canadians through the tough times ahead.”
But the prime minister noted that he “reiterated the facts” during his 50-minute phone call with Trump on Wednesday — implicitly rejecting the president’s claims about drugs coming into the U.S. from Canada.
“Our border is secure, and less than 1% of the illegal fentanyl entering the United States comes from Canada,” Trudeau said.
“I also stress that the tariffs the U.S. administration chose to impose will hurt American workers and businesses,” he said.
Asked to describe that call in light of Wall Street Journal reporting that the call “grew heated and included profanity,” Trudeau said he could confirm that it was a “colorful call.”
— Kevin Breuninger
The Port of Newark in Newark, New Jersey, US, on Monday, Sept. 30, 2024.
Michael Nagle | Bloomberg | Getty Images
The U.S. trade deficit with its global partners hit a record in January as President Donald Trump began his tariff campaign, the Commerce Department reported Thursday.
The goods and services deficit for the month totaled $131.4 billion, a $33.3 billion surge and higher than the Dow Jones estimate for a shortfall of $128.7 billion.
Though exports increased slightly to $269.8 billion, imports jumped 10% to $401.2 billion. On a year-over-year basis, the trade deficit soared 96.5% as exports rose just 4.1% while imports surged 23.1%.
—Jeff Cox
Marlon removes American whiskey products from the LCBO shelves.
Nick Lachance | Toronto Star | Getty Images
Canada’s decision to pull U.S. products from store shelves is a “very disproportionate” response to Trump’s tariffs, the maker of Jack Daniels said.
Brown-Forman CEO Lawson Whiting said removing products from store shelves is “worse than a tariff because it’s literally taking your sales way.”
Brown-Forman can withstand Canada’s retaliation because the country represents just 1% of the company’s sales, Whiting told investors on the company’s earnings call Wednesday afternoon. But it is disappointing because Jack Daniel’s is a popular brand in Canada, Whiting said.
— Spencer Kimball
A Walmart truck pulls out of a Walmart Distribution Center in Hurricane, Utah on May 30, 2024.
George Frey | Afp | Getty Images
Walmart has asked some Chinese suppliers for major price reductions, according to Bloomberg News.
Certain suppliers, including kitchenware and clothing producers, have been asked to lower their prices by as much as 10% per round of President Donald Trump’s tariffs, which would mean taking on the full cost of the duties, Bloomberg said, citing people familiar with the matter.
The report also said that “few have acquiesced,” with the sources revealing that some suppliers would lose money if they cut prices by more than 2%.
— Sean Conlon
Traders work on the floor of the New York Stock Exchange (NYSE) in the Financial District in New York City on March 4, 2025.
Timothy A. Clary | Afp | Getty Images
Karina Gould, former House Leader, speaks during a press conference following the second night of debate in the federal Liberal leadership race to replace Canadian Prime Minister Justin Trudeau at the MELS studios in Montreal, Canada, on February 25, 2025.
Andrej Ivanov | Afp | Getty Images
Trump’s tariffs are whipping up a swell of patriotic fervor among Canadians who are so furious about the “unjustified” and “ill-conceived” duties that they are boycotting U.S. products, Canadian politician Karina Gould said.
“As Canadians, we feel that the relationship with the United States, the trust has been broken,” Gould, a Canadian Liberal Party member and candidate for prime minister, told CNBC’s “Squawk Box” on Thursday morning.
“I have never seen this kind of patriotism in Canada, where you have little old ladies going to the grocery store and choosing to buy Canadian products over American products,” she said.
“You know, Canadians are known for apologizing, but we’re not going to back down right now, and we’re not going to apologize for defending our economy, our jobs and our way of life.”
Gould also rejected questions about whether Canada should consider dropping some of the tariffs it already had on U.S. products in order to strengthen its case.
She noted that Trump is basing the tariffs on alleged fentanyl trafficking from Canada, even though “minuscule amounts” come to the U.S. through the northern border.
“But if that’s what he cares about, well then let’s put together an inspection team at the border to inspect every truck that goes south for fentanyl and every truck that comes north for illegal guns,” she said.
— Kevin Breuninger
Signage for Taiwan Semiconductor Manufacturing Company (TSMC) at it’s fabrication plant in Phoenix, Arizona, US, on Monday, March 3, 2025.
Rebecca Noble | Bloomberg | Getty Images
The semiconductor industry is particularly vulnerable to tariffs due to how globally integrated its supply chains are, according to Chris Miller, Tufts Fletcher School professor and “Chip War” author.
Even if chips are assembled in the U.S., many of the components used are not manufactured in the U.S., Miller noted.
“The complexity of the supply chains makes devising a tariff policy around carve-outs very, very difficult, which is why the industry is hoping there won’t be any changes at all — because they’ve been structured around the assumption that you can move goods back and forth across borders without this type of tariff uncertainty,” Miller told CNBC’s “Squawk Box” on Thursday.
— Hakyung Kim
Correction: Chris Miller is a professor at the Tufts Fletcher School. An earlier version misstated the school’s name.
U.S. Secretary of Agriculture Brooke Rollins speaks to members of the press outside of the White House in Washington, D.C. on Feb. 14, 2025.
Bryan Dozier | AFP | Getty Images
The White House is considering exemptions for some agricultural goods from the tariffs on Mexico and Canada, according to Bloomberg News.
“As far as specific exemptions and carveouts for the agriculture industry, perhaps for potash and fertilizer, et cetera — to be determined,” Agriculture Secretary Brooke Rollins said Wednesday, according to Bloomberg. Canada is a major source of fertilizer supplies for the U.S. agriculture industry.
A White House spokesperson also said Wednesday that President Donald Trump was “open” to more tariff exemptions after delaying auto industry levies for one month.
— Jesse Pound
A Jeep Rubicon vehicle at a Jeep dealership in Richmond, California, US, on Monday, March 3, 2025.
Bloomberg | Bloomberg | Getty Images
Automaker Stellantis thanked President Donald Trump for the one-month tariff exemption on automakers and vowed it will grow its business in the U.S.
“We share the President’s objective to build more American cars and create lasting American jobs. We look forward to working with him and his team,” the company said in a statement.
Shares of the Jeep and Dodge maker were down 1.6% in premarket trading Thursday, after gaining 9.24% on Wednesday.
— Michelle Fox
In an aerial view, the Target logo is displayed on the exterior of a Target store on March 5, 2025 in Albany, California.
Justin Sullivan | Getty Images
Tariffs are weighing heavily on the minds of business executives, with concerns expressed in multiple surveys this week over rising costs and the inability to pass higher prices on to consumers.
“The incoming tariffs are causing our products to increase in price. Sweeping price increases are incoming from suppliers. Most are noting increases in labor costs,” a purchase manager in the machinery sector said in the ISM manufacturing survey for February. “Inflationary pressures are a concern. Our company is working diligently to see how the new tariffs will affect our business.”
That response was representative across reports that showed continued expansion across the economy but increasing worries about President Donald Trump’s trade policy.
Worries over the new duties were not confined to the manufacturing sector. In the ISM services survey, business leaders also indicated sentiment that price increases are coming, with a potentially negative impact on profitability.
“Tariffs are going to have a ripple down effect that could severely harm our business,” a technology manager said.
“Business seemed to pop after the election, but uncertainty after the election seemed to take the ‘wind out of our sales,’ with uncertainty again increasing,” added a representative from the professional, scientific and technical services field.
In the Federal Reserve’s periodic Beige Book look at economic conditions, there were more than 50 mentions of either tariffs or trade policy concerns.
“Many contacts reported difficulty setting prices and noted ambiguity around costs, largely as a result of uncertain international trade policy,” the Atlanta Fed reported. “Most firms said they expected to pass through the bulk of any additional costs to customers.”
Chris Williamson, chief business economist at S&P Global Market Intelligence, noted that the firm’s monthly survey showed services activity expanding but at a much slower pace, with business executives concerned over tariffs.
“Adding to the gloomier picture in February was a sharp rise in costs, which companies were often unable to pass on to customers due to weak demand,” he said. “While this reduced pricing power is good news for inflation, it’s potentially bad news for profitability.”
— Jeff Cox
