A potential tariff rollback could ease trade tensions and drive a crypto and stock market rebound.
Trump Administration Signals Tariff Relief
U.S. Commerce Secretary Howard Lutnick revealed that President Donald Trump may scale back tariffs on Canadian and Mexican goods as early as tomorrow. This follows intense negotiations between the three nations, hinting at a potential shift in U.S. trade policy.
Lutnick’s statement comes after the U.S. stock market faced two days of sharp declines, fueled by fears of escalating trade wars. The possible tariff rollback immediately boosted investor sentiment, with major stock indices and tech ETFs rebounding in late trading.
Uncertainty Around Tariff Reductions
While Lutnick did not disclose full details, he suggested that Trump is open to a compromise but is unlikely to remove tariffs entirely. “Both the Mexicans and the Canadians are on the phone with me all day today, trying to show that they’ll do better,” Lutnick said. He added that any agreement would require Canada and Mexico to address key issues raised by the administration.
These remarks came just hours before Trump was scheduled to deliver a primetime speech to Congress, where further clarity on the trade policy shift could be provided.
Potential Trade War with the EU
Despite softening his stance on North American trade partners, Trump remains firm on tariffs against China and has hinted at new duties on the European Union. Tariffs on Chinese goods, first implemented in February, triggered a 20% increase on imports, with China retaliating by imposing 15% duties on U.S. agricultural products.
With the possibility of European tariffs looming, analysts warn that a prolonged trade war could still pose risks to global financial markets.
Crypto Market Bounces Back
The previous tariff announcements sent shockwaves through the crypto market, with Bitcoin plunging over 9% to $83,000 and Ethereum falling by 15%. However, news of potential relief has reversed some of these losses.
Bitcoin surged over 4% to $87,723, while Ethereum climbed 5%. Altcoins saw notable gains, with XRP rising 9%, Solana up 5%, and Cardano surging 22% over the past 24 hours. The total cryptocurrency market capitalization has increased by 4%, approaching the $4 trillion mark.
Stock Market Reaction
Crypto-related stocks have also rebounded. MicroStrategy (MSTR) jumped 9.55%, Coinbase (COIN) gained 3.22%, and Marathon Digital (MARA) climbed 1.34%. These movements highlight how policy shifts influence investor confidence in both traditional and digital asset markets.
What’s Next for Markets?
The market remains highly reactive to trade policy updates, and further announcements from the Trump administration could dictate short-term volatility. Investors are watching Trump’s upcoming speech closely for definitive statements on tariff policy, as any sudden changes could impact both stock and crypto markets.
Disclaimer:
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