Trump Holds the Line—Mexico Drops Trade Barriers to Avoid Tariff Spike

President Trump, on Thursday, extended the tariff pause on Mexico for another 90 days, in the hopes that a larger trade deal can be made. Mexico's President agreed to immediately suspend non-tariff trade barriers to secure the extended pause. The tariff rate will remain, with a 25 percent "fentanyl" tariff, a 25 percent tariff on cars, and a 50 percent tariff on steel, aluminum, and copper.

.@PressSec: "Mexico has agreed to immediately terminate its non-tariff trade barriers, of which there are many. As the President said, we will continue to talk to Mexico over the next 90 days with the goal of signing a larger trade deal." pic.twitter.com/wjxNRoWIhf
— Rapid Response 47 (@RapidResponse47) July 31, 2025

Trump on trade with Mexico pic.twitter.com/dbtqWqpKSo
— The Post Millennial (@TPostMillennial) July 31, 2025

“We avoided the tariff increase announced for tomorrow and we got 90 days to build a long-term agreement through dialogue,” the President of Mexico, Claudia Sheinbaum, wrote on X.

President Trump announced sweeping tariffs on Liberation Day on April 2nd of this year, citing a national emergency over the United States' trade deficit. On April 9th, a 90-day pause was put on the "reciprocal tariffs," establishing a flat rate of 10 percent, so countries had an opportunity to cut favorable trade deals with the United States. While good progress was made, that 90-day pause was again extended until August 1st to give countries even more time to cut deals.

In the lead-up to the August 1st deadline, President Trump has already finalized several major trade deals. On July 28th, the U.S. and European Union announced an agreement that expands access for American goods, cuts EU tariffs on U.S. industrial products, and sets a 15 percent reciprocal tariff on key sectors like autos, pharmaceuticals, and semiconductors. Tariffs on steel and aluminum remain in place. Earlier in July, the U.S. reached a deal with Japan that lowers tariffs on Japanese imports from a threatened 25 percent to 15 percent, alongside a $550 billion investment commitment from Japan. On July 2, the U.S. struck a deal with Vietnam that allows duty-free entry for American goods, while Vietnamese exports will face a 20 percent tariff. Across the board, these deals show Trump’s push to reset global trade on U.S. terms, using tariff threats to bring countries to the table.