Trump’s sudden decision to pause the planned 25% tariffs on Mexican imports has sent waves through the markets, providing a welcome relief to investors. After the U.S. president’s unexpected call with Mexican President Claudia Sheinbaum, which saw an agreement to send 10,000 National Guard troops to the border to fight drug trafficking, markets reacted positively. Stocks, which had initially opened lower, clawed back losses, and the crypto market followed suit, with Bitcoin (BTC-USD) increase to reach over $99,700 at 1.37pm today.
The news of the tariff delay was a game-changer for the crypto space, where prices had been under pressure due to concerns over global trade tensions. Ethereum (ETH-USD), which had briefly fallen 27% has rebounded to cover majority of its daily losses. The market’s recovery underscores how sensitive digital assets are to macroeconomic news, especially when geopolitical factors come into play. Leveraged positions in Ether were hit hardest, with traders forced to unwind their bets as the sell-off gained momentum, but the tariff delay brought some much-needed stability.
Despite the positive market reactions, investors know this isn’t a long-term fix. Trump’s support for crypto remains shaky, with initiatives like an executive order creating uncertainty around future regulations. As for the broader market, the question still remains: how long will this tariff delay last, and what impact will it have on trade relations moving forward? Investors are riding the wave for now, but everyone knows that these trade talks could easily take a turn for the worse, keeping markets on edge.
This article first appeared on GuruFocus.