Trump Keeps His Promise: TPP is Gone, NAFTA is Next

In breaking news, President Donald Trump kept a campaign promise when he signed an executive order formally withdrawing the U.S. from the 12-nation Trans-Pacific Partnership trade deal. Trump called the TPP order a “great thing for the American worker.” Free trade deals like the TPP have traditionally been unpopular with blue-collar workers.

Although many critics of Trump may want to pin any problems with withdrawing from the TPP on the new President, keep in mind that the deal has also been unpopular with the Democrats. Senators Bernie Sanders and Elizabeth Warren have come out against the trade deal along with traditional Democratic Party supports such as trade unions and environmentalists.

“The U.S. leaving TPP is a problem of America rejecting globalization, and China is a beneficiary of globalization and China is not willing to see the tide of globalization ebb,” said Da Wei, an expert on the U.S. at the China Institute of Contemporary International Relations.

While some Chinese may be happy at what they see as a political failure for the U.S., ultimately “China disapproves of this; China is anxious about the retreat of globalization”, Da said.

Shortly after the announcement, the AUD/USD is trading at .7556, up 0.0035 or +0.05%. The NZD/USD is at .7210, up 0.0046 or +0.64%.

U.S. stocks are down sharply with the March E-mini S&P 500 Index trading at 2255.00, down 10.50 or -0.46%. The March E-mini Dow Jones Industrial Average is down 0.25% and the March E-mini NASDAQ-100 Index is off 0.23%.

With stocks falling, flight to safety buying is increasing, the USD/JPY is down 1.31%.

In other news, President Donald Trump is also expected to sign an executive order later today stating his intention to renegotiate the free trade agreement between the United States, Canada and Mexico. Eliminating the North American Free Trade Agreement (NAFTA) was also a Trump campaign promise.

Trump felt that NAFTA was destroying America’s manufacturing sector and called it “one of the worst deals ever”. However, it should be noted that with this deal, U.S. manufacturing exports to Canada and Mexico, increased 258 percent and the deal helped create a trade surplus in agriculture and manufactured goods.

“We will be starting negotiations having to do with NAFTA,” Trump said Sunday at a swearing-in ceremony for his top White House advisers. “We are going to start renegotiating on NAFTA, on immigration and on security at the