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Will Trump impose 25% tariff on Mexico/Canada?

On November 25, Donald Trump announced that he would "sign all necessary documents to charge Mexico and Canada a 25% Tariff on ALL products coming into the United States". (see: https://truthsocial.com/@realDonaldTrump/posts/113546215051155542). This market will resolve to "Yes" if Donald Trump signs any federal legislation or performs any executive action enacting a general 25% or greater tariff on imports into the United States from Mexico or Canada by January 31, 2025, 11:59 PM ET. Otherwise, this market will resolve to "No." A general tariff that includes item-specific exceptions will still qualify, as long as a policy of a general 25% or greater tariff on imports into the United States from Mexico or Canada is enacted. If a tariff is instituted on Mexico but not Canada, or on Canada but not Mexico, it will still qualify. Any tariff which is officially enacted within the market's time frame will qualify, regardless of when the tariff goes into effect. This market's primary resolution source will be official information from the Trump administration, however a consensus of credible information will also be used.

Event Details

Total Volume: $141.7K
24h Volume: $22.8K
Total Liquidity: $45.8K
Markets: 1
Event Ends: 1/31/2025

Event Analysis

Summary

Donald Trump has announced plans to impose a 25% tariff on all imports from Mexico and Canada upon taking office on January 20, 2025, citing concerns about border security and drug trafficking. This declaration, made on Truth Social, represents a significant potential shift in North American trade relations and has drawn attention from economists and political analysts. The announcement comes at a time when Mexico has become the United States' largest trading partner, surpassing China, with Canada following closely as the second-largest partner. The implementation of such tariffs would have substantial implications for the integrated North American supply chains and could potentially trigger retaliatory measures from both countries.

Analysis

Economic Background

  • Mexico and Canada are currently the US's top trading partners
  • Trade volume with Mexico reached approximately $800 billion last year
  • The US-Mexico-Canada Agreement (USMCA) currently governs trade relations
  • Recent trends show increased nearshoring from China to Mexico

Outcome Analysis

Likelihood of Tariff Implementation

Supporting Factors

  • Trump's clear statement of intent to implement on day one
  • Historical precedent of following through on tariff threats
  • Executive authority to impose tariffs exists
  • Consistent messaging on trade policy

Opposing Factors

  • Potential economic disruption to US supply chains
  • Risk of retaliatory measures from Canada and Mexico
  • Business community likely to oppose
  • Possible legal challenges under USMCA

Key Factors to Watch

  1. Political Developments
  • Transition period activities
  • Cabinet appointments, especially Treasury Secretary
  • Congressional response
  1. Economic Indicators
  • Inflation trends
  • Trade balance figures
  • Supply chain resilience
  1. International Response
  • Canadian and Mexican diplomatic reactions
  • Alternative trade partnership discussions
  • USMCA dispute mechanisms

Recent Developments

  • Trump's explicit announcement via Truth Social
  • Stated timeline for January 20, 2025 implementation
  • Connection to border security and drug trafficking issues
  • Initial cautious responses from Canadian officials

Prediction

Based on the available evidence, I estimate a 65% probability that Trump will implement the announced 25% tariffs on Mexico and Canada by January 31, 2025. This assessment is based on his clear statement of intent, historical pattern of following through on tariff threats, and executive authority to act. However, significant economic and political headwinds could still prevent implementation.

Will Trump impose 25% tariff on Mexico/Canada

Yes:65.0%
No:35.0%
Confidence: 7/10
Reasoning Score: 8/10

Sources

Market Options

Will Trump impose 25% tariff on Mexico/Canada?

Yes
22.5%
No
77.5%
Liquidity: $45.8K
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