Crypto markets sharply rebounded after US President Donald Trump agreed to put a temporary hold on proposed tariffs aimed at Canada and Mexico as negotiations with the countries continue.
In a Feb. 3 statement on X, Canadian Prime minster Justin Trudeau said that after a phone call with Trump, the 25% tariffs would be paused for at least 30 days and the two countries would work together.
Trudeau says Canada would be enhancing “coordination with our American partners” by implementing a $1.3 billion border plan, including appointing a Fentanyl czar, listing cartels as terrorists and reinforcing the US-Canada border with helicopters and more personnel.
Source: Justin Trudeau
Mexico’s tariffs have also been paused for a month. Mexico President Claudia Sheinbaum said in a Feb. 3 statement to X that the two leaders had “reached a series of agreements,” with a similar promise of reinforcing the land border shared between the two countries.
“Our teams will begin working today on two fronts: security and trade. They are pausing tariffs for one month from now,” Sheinbaum said.
In a Feb. 3 interview with Bloomberg TV, Trump said the US and Mexico have not “agreed on tariffs yet” and they could still go into effect.
The Feb. 1 executive order imposing the tariffs on Mexico and Canada also slapped China with a 10% tariff, which hasn’t yet been paused. A Feb. 3 Wall Street Journal report says the country’s government is prepared to negotiate.
Citing sources, the Journal says China’s initial proposal involves restoring the Phase 1 trade deal signed in 2020 during Trump’s first term that requires Beijing to increase purchases of US exports by $200 billion over two years.
Bettors on crypto-based prediction platform Polymarket have odds of 24% that Trump will completely remove the tariff on Mexico before March and give a 22% chance for Canada to have its tariffs removed.
China on the other hand, has been listed as only having a 9% chance of having its tariffs removed next month.
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Cryptocurrency prices had plummeted just a day earlier, on Feb. 3, after Trump announced potential tariffs on goods from China, Mexico and Canada. Some estimates suggested up to $10 billion of worth capital was liquidated from the markets.
Following the string of announcements by world leaders, the crypto market has been steadily climbing.
Bitcoin (BTC) has increased has crossed over the 100,000 threshold to $101,731, after hitting a low of $92,000 the day before, according to CoinMarketCap.
Meanwhile, CoinMarketCap shows Ether (ETH) has also performed better compared to Feb. 2. The second-largest cryptocurrency by market cap reached a low of $2,451, but it has since climbed back to $2,880.
The Crypto Fear & Greed Index, which measures market sentiment for Bitcoin and other cryptocurrencies, has also seen an uptick, crossing over into greed territory with a score of 72 out of 100 after previously being in fear.
The crypto Fear & Greed Index score has risen on the news Tariffs on Canada and Mexico have been paused. Source: Alternative.me
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