There may be tariff exemptions for Mexico and Canada on the basis of National Security (not NAFTA)

A little different wiggle from the President

One of the story lines is that the tariffs are because of National Security concerns.

Now the White House is saying there may be tariff exemptions for Mexico and Canada on the basis of National Security.

That is different then on the basis of a NAFTA agreement.

The WH support that by by saying:

• Potential tariff exemptions will be decided on a country by country basis based on national security

So they excuse for not being broad based - inclusive of Canada/Mexico which could hurt NAFTA - is by saying both are part of the National Security story.

Putting it another way, it means that because of reliance on Canada/Mexico steel for defense purposes, slapping a 25% tariff on it is really not that great of an idea. I wonder if German steelmakers will get a pass too?

The USDCAD has moved lower on the headline (stronger CAD).