President of the United States, Donald Trump, has vowed to impose a tariff on all goods coming from Mexico, following a surge of illegal immigrants across the southern border.
Trump declared this on his twitter handle, saying the tariff will start at 5% and ratcheting much higher until the flow of people ceases.
The president’s move is in his bid to control a wave of tens of thousands of asylum seekers, including many Central American families fleeing poverty and violence, that has swelled alongside his promises to make it harder to get U.S. refuge and his efforts to build a wall on the Mexican border.
The announcement rattled investors who feared that worsening trade friction could hurt the global economy.
The Mexican peso, U.S. stock index futures and Asian stock markets tumbled on the news, including the shares of Japanese automakers who ship cars from Mexico to the United States.
The president’s decision, announced on Twitter and in a subsequent statement, was a direct challenge to Mexican President Andres Manuel Lopez Obrador and took the Mexican government by surprise on a day when it had started a formal process to ratify a trade deal with the United States and Canada (USMCA)