President Donald Trump tweeted that he would impose a five per cent levy on all imports from Mexico starting on June 10. The levy will remain in place “until such time as illegal migrants coming through Mexico, and into our Country, STOP,” he wrote on Wednesday night. The White House said the tariff will increase five per cent every month until it hits 25 per cent in October. Jesús Seade, Mexico’s deputy foreign minister for North America, promised that his government would respond “strongly.” (Canadian Press)

Talking point: The Trump administration has been pushing for legislatures in all three USMCA countries to ratify the treaty, but new tariffs could slow down that process. The White House only removed a different levy-related hurdle to the treaty in mid-May, when it lifted duties on steel and aluminium imports from Canada and Mexico. Influential members of Congress like Iowa Senator Chuck Grassley had refused to let the USMCA proceed until those tariffs were removed, because of the damage countermeasures were doing to U.S. businesses. A new Mexican tariff is likely to have similar negative effects—the market value of 12 large automakers, for example, had fallen a combined US$18 billion by the time the markets opened Friday morning. Those firms are huge employers in the U.S., making them a potent lobby against the levies.