Trump makes major announcement on Mexico tariffs just hours before they were supposed to go into effect

Donald Trump has made a huge announcement about Mexico's tariffs just hours before the deadline.

Ever since April 2 when Trump declared America would remember the momentous occasion as 'Liberation Day' due to its eye-watering reciprocal tariffs plan against its trading partners, the US president has been playing a hardline game of trade tennis.

While the POTUS has since backtracked with delays for some countries, and shook hands in agreements with others including the UK, Japan and the European Union, Trump set August 1 as a revised deadline for all negotiations to have been completed - or else feel the wrath of his strict tariff rates.

Australia, India, Canada and Mexico are among the key partners that have not reached a deal with the US as of July 31, with Trump threatening to slap a global baseline tariff of around 15 to 20 percent on each - higher than the proposed 10 percent baseline he announced in April.

Trump with European Commission President Ursula von der Leyen after securing a US-EU trade deal (BRENDAN SMIALOWSKI/AFP via Getty Images)

Trump has also threatened tariffs of around 30 percent on good from Mexico earlier this month.

Now, however, it appears the country will be able to stave off the high tax rate for at least three months as Trump announced a new 90-day negotiation period with Mexico.

Posting on his Truth Social platform, Trump said he has spoken to Mexican leader Claudia Sheinbaum which was 'very successful' in that they are 'getting to know and understand each other.'

“We avoided the tariff increase announced for tomorrow and we got 90 days to build a long-term agreement through dialogue,” the Mexican president added on Twitter.

However, that's not to say Mexico can breathe a sigh of relief as 25 percent tariff rates will continue to remain in place.

"The complexities of a Deal with Mexico are somewhat different than other Nations because of both the problems, and assets, of the Border," Trump said before adding that goods passing into the US from Mexico would continue to face a 25 percent tariff, linked to alleged drugs trafficking that he labelled a '25 percent Fentanyl tariff.'

Claudia Sheinbaum and Trump have apparently agreed to a new 90-day negotiation period (Rodrigo del Río/ObturadorMX/Getty Images)

"We have agreed to extend, for a 90 Day period, the exact same deal as we had for the last short period of time," he continued, which includes a 25 percent tariff on cars while copper, aluminum and steel would be taxed at 50 percent.

"Additionally, Mexico has agreed to immediately terminate its Non Tariff Trade Barriers, of which there were many. We will be talking to Mexico over the next 90 Days with the goal of signing a Trade Deal somewhere within the 90 Day period of time, or longer.

"There will be continued cooperation on the Border as it relates to all aspects of Security, including Drugs, Drug Distribution, and Illegal Immigration into the United States. Thank you for your attention to this matter!" he concluded.

Some goods continue to be protected from Trump's tariffs by the 2020 US Mexico Canada Agreement (USMCA), that he negotiated in his first term, though this is up for renegotiation next year.

The news comes as India is bracing for a 25 percent tariff, as well as an additional unspecified 'penalty' for what Trump considered unfair trade policies and for the country's purchase of military equipment and energy from Russia.

Canada is likewise expected to be hit with 35 percent tariffs on several goods as of tomorrow, if not more as the POTUS claims the rate could increase if the neighbors retaliate.

As for Australia, which runs a trade deficit with the US, it appears likely the baseline of 10 percent tariffs could apply, or possibly the newly revised higher baseline of 15 to 20 percent.