☕ Trump reverses tariffs (for now)

It’s Tuesday.

And just like that, the tariffs placed on Canadian and Mexican goods are reversed (for now).

But, also just like that, new tariffs placed on Chinese goods come into effect - and China has already responded. Read on to learn a bit more.

I’ve got 30 seconds

Some headlines from this morning:

🇸🇻 El Salvador has agreed to receive and house US prisoners, in a deal announced by new Secretary of State Marco Rubio. In a combined press conference with El Salvador’s President, Nayib Bukele, the move was described as “an act of extraordinary friendship”, and some of the most dangerous American criminals would be part of the move. In exchange, El Salvador will get a fee for each prisoner, which Bukele described as “relatively low for the US, but significant for us, making our entire prison system sustainable”.

📄 The lawsuit between actors Justin Baldoni and Blake Lively has commenced in a Manhattan court. The actors were not required to attend the pretrial meeting, where their lawyers both alleged the other side was using the press to gain advantage in the courtroom. The judge said if the case continued to be “litigated in the press”, he would bring forward the March 2026 trial date to minimize the potential of a prejudiced jury.

🇮🇱 Israeli Prime Minister Benjamin Netanyahu will become the first foreign leader to visit President Trump at the White House. The two leaders will discuss the next phase of the ceasefire between Israel and Hamas, with Netanyahu’s visit thought to begin the official negotiation period. The leaders will also discuss normalized relations between Israel and Saudi Arabia, as well as the growing regional influence of Iran.

⚽ The trial of former Spanish football boss Luis Rubiales for alleged sexual assault has begun. Rubiales kissed player Jenni Hermoso after Spain won the 2023 FIFA Women’s World Cup. Hermoso alleges the kiss was not consensual, which Rubiales denies. Speaking to the court, Hermoso said the moment “tainted one of the happiest days of my life”. Rubiales faces a prison term of up to two and a half years if he’s found guilty.

I’ve got 1 minute

President Trump ordered the creation of a US sovereign wealth fund within the next year. The order, which fulfils one of President Trump’s campaign, leaves important questions over how money will be collected, and how it will be spent.

So what is a sovereign wealth fund, and what do you need to know?

Sovereign Wealth Fund

A sovereign wealth fund is a state-owned investment fund that manages national savings, often derived from extra revenue that is generated from national resources.

If successful, the US will join 90 other countries with sovereign wealth funds such as Norway, whose fund is made up of excess profits from the sale of state-owned oil. There, these funds now subsidise a comprehensive social welfare system and ensure Norway’s economy is not overly reliant on oil in the future.

Countries with a sovereign wealth fund usually operate in a surplus, making more money than they spend - and the fund houses the profits. However, the US operates in an expanding deficit, spending more money than they make. This has caused some critics to doubt whether a US sovereign wealth fund is necessary.

Why does Trump want to make one?

During his 2024 campaign, President Trump said the sovereign wealth fund could finance "great national endeavors", such as large infrastructure projects.

President Biden considered creating a fund as well, towards the end of his administration.

Trump has also indicated that, if his attempts to force TikTok to sell itself to an American company fail in the next three months, TikTok may be absorbed into the fund (meaning cash in the fund would be used to purchase a portion, or all, of the company).

There is also speculation that a portion of the fund will be used to buy bitcoin, the largest cryptocurrency, in a strategic move to ensure the US is exposed to the coin’s potential growth.

What’s next?

The Department of Treasury has said that the fund will be established within 12 months as officials grapple with the structure and finer details of the fund.

The order specified that officials look into any legislation that may need to be written and voted through by Congress to create the fund; some experts expect Congressional approval will be required.

I’ve got 2 minutes

Tariffs levied on Saturday against Mexico and Canada will be suspended for one month after the two countries' leaders made calls to President Trump yesterday. President Trump announced that the two leaders promised action over the next 30 days which reassured him that his concerns regarding drug trafficking and immigration were being sufficiently addressed.

Let’s take it back - here’s some context?

Over the weekend, President Trump signed a tranche of executive orders that imposed new tariffs, a tax placed on imported goods or services, on America’s three largest trading partners - Canada, Mexico and China.

A 25% tariff was placed on all Canadian and Mexican goods, except for Canadian energy which was taxed at 10%. The two countries responded with their own tariffs on American goods. A 10% China tariff will come into effect on Tuesday.

President Trump said the tariffs were being imposed due to his concerns about illegal immigration and drug trafficking, as well as his belief that the US is ripped off by their trading partners.

Negotiations with Mexico

Mexican President Claudia Shaffaulbaum reached an agreement with President Trump on Monday morning. Mexico will now send 10,000 of their national guard to secure the US-Mexican Border.

These measures have been taken to try to restrict the flow of drugs from Mexico to the US, particularly the extremely potent synthetic opioid Fentanyl, as well as the trafficking of high powered rifles.

The Mexican President said the two Presidents had "good conversation with great respect for our relationship and sovereignty".

Negotiations with Canada

Negotiations with Canada took a bit longer, with two calls occurring throughout the day. It was only after the second call that Trump announced a 30-day pause to the Canadian tariffs as well.

Canada has agreed to take efforts to further secure the border including by continuing with the previously announced $1 billion dollar border securement fund, deploy additional technology, and support and appoint a ‘fentanyl czar’.

What’s next?

Both countries have announced that they hope this 30 day freeze of the current tariffs can lead to a more permanent economic agreement, and the aversion of tariffs altogether.

Although these tariffs were flagged during President Trump’s election, the speed of implementation has taken the world by surprise and seen markets plummet in the uncertainty.

China’s tariffs commence tomorrow, and they have announced a 15% tariff on US coal and liquid natural gas (LNG). President Trump has also indicated he intends to levy similar tariffs against the EU.