The prospect of an end to the trade war between the United States and Canada by May was estimated at over 60%, according to a Polymarket contract on the situation.
Despite the rise in recent days, there has been a subsequent drop in bets backing a conclusion to the saga within weeks.
Progress has been mooted after Commerce Secretary Howard Lutnick revealed that President Donald Trump is open to negotiation.
The backdrop is that Trump has granted a one-month exemption to stringent tariffs on imports from Canada and Mexico for American auto firms, due to concerns of a significant impact on manufacturing.
His decision was influenced following a meeting with executives from the “Big 3” of car makers, Ford, General Motors, and Stellantis.
The imposition of 25% tariffs by the President was said to be related to the perception that Canada and Mexico were not doing enough to stop the flow of the potent synthetic drug fentanyl, and illegal immigration into the States.
🚨 NEW POLYMARKET: Will Trump lower automobile tariffs on Canada/Mexico by next Friday?
Commerce Secretary Howard Lutnick told Bloomberg "changes" to the auto tariffs are coming soon.https://t.co/x2emww2xv4
— Polymarket (@Polymarket) March 5, 2025
Ongoing movement in the market
The prediction platform Polymarket reflected the change of feeling, as underlined by Lutnick’s remarks to Fox Business.
Shortly after his comments on Tuesday (Mar. 4), the odds of a detente increased by 20% on Polymarket, rising as high as 63%.
“I think [Trump is] going to work something out with them,” said the Commerce Secretary.
“It’s not going to be a pause, none of that pause stuff, but I think he’s going to figure out: you do more, and I’ll meet you in the middle someway and we’re going to probably announce that tomorrow.”
The changing narrative also had an impact on crypto markets, sending Bitcoin up 1.5% and trading comfortably above the $87,000 mark, as reflected by CoinDesk’s Indices data.
At the time of writing there has been movement in the market, with bettors indicating a 51% chance that President Trump will remove the tariffs on Canada by May
Image credit: Via Midjourney
