Trump’s opening salvo on tariffs: Is he declaring war or applying a negotiating ploy?

US PRESIDENT-ELECT Donald Trump announced on social media late last Monday (Nov 25) that he would slap tariffs of 25 per cent on Canada and Mexico and an additional 10 per cent on China.

So was Trump sending a clear message to America’s trade rivals and partners that he would govern as he campaigned, as a mercantilist? He is in charge, including of the economic agenda, and was committed to fulfil his campaign’s populist vows.

The financial markets took the prospect of the new tariffs in stride. Shares of car makers were hit hard but the fall in the Canadian dollar and Mexican peso was muted and the major broad indexes of stock pushed higher on Tuesday following Trump’s comments.