The delay with Mexico bolsters the view that Trump sees tariffs as a negotiating ploy but is still reluctant to inflict economic pain on Americans, while buying Sheinbaum time to show that she is a partner to the United States rather than an adversary.

The two nations will continue negotiations over the tariffs during the next month, according to both leaders, with Sheinbaum saying at a Monday press conference that she and Trump agreed to speak frequently. As part of the deal, the U.S. also pledged to work to prevent the trafficking of high-powered weapons into Mexico, she said at the press conference.

The talks will be “headed by Secretary of State Marco Rubio, Secretary of Treasury Scott Bessent, and Secretary of Commerce Howard Lutnick, and high-level Representatives of Mexico,” Trump said in his social media post.

It remains unclear whether Canada, which is also facing the threat of 25 percent tariffs on most goods, will be able to reach a similar deal with Washington. Trump and Canadian Prime Minister Justin Trudeau spoke by phone Monday morning and are scheduled to hold another call in the afternoon. The U.S. president said he pressed the Canadian leader about American banks’ ability to do business in Canada. “We had a good talk,” Trump said. “Canada is very tough. They’re very, very tough to do business with, and we can’t let them take advantage of the U.S.”

He also repeated his assertion that Canada should become the 51st U.S. state but conceded, “some people say that would be a long shot.” Sheinbaum said that she has also been in contact with Trudeau and will continue speaking with Canada.

Trump also said he will “probably” be speaking to Chinese officials in the next 24 hours about his threat to impose a new 10 percent tariff. “That was just an opening salvo. If we can’t make a deal with China, then the tariffs will be very, very substantial,” the U.S. president said.

Sheinbaum took office in October facing questions about how she would fill the shoes of her popular predecessor, Andres Manuel Lopez Obrador, who boasted about his good relationship with Trump. The early victory suggests she’s a skilled negotiator, with a cool-headed approach that focuses on specific details rather than Trump’s rhetoric.

“Mexico’s efforts in collaborating with the U.S. seems to have paid off, for now,” said Dan Pan, an economist at Standard Chartered Bank. “The uncertainty still remains on which direction the negotiations will take and if Mexico can avert the tariffs permanently, but for now the market has taken comfort of the delay as an indication that Trump is using the tariff threats as a negotiation strategy rather than jeopardizing the North American economy.”

After Trump ordered 25 percent tariffs on exports from Mexico on Saturday, Sheinbaum said she would ask her economy minister to respond with tariff and non-tariff measures, without elaborating. She said Monday that Mexico will put those measures on hold in an effort to provide certainty to financial markets, and reiterated her commitment to the USMCA free trade agreement between the U.S., Mexico, and Canada.

“Most in the market were looking for this sort of ‘deal’ to occur in order to avoid tariff implementation, similar to what we saw in Trump 1.0 between the U.S. and Mexico,” said Brad Bechtel, head of FX at Jefferies. “Tariff risk for Mexico avoided for now, at least for one month. Most assume the same for Canada, but we need to wait and hear officially. Canada already announced countermeasures, and their government is somewhat in chaos, so it may not happen as quickly as it did for Mexico.”

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