Trump’s tariffs, Rubio in Panama, Grammys and a reservation’s fentanyl crisis
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Today, Trump's tariffs rattle global markets, with China, Mexico and Canada all threatening retaliation. Marco Rubio tells Panama to end what he calls China's influence over the canal, or face U.S. action. Concern over fentanyl deaths at a New Mexico reservation. And Beyonce and Kendrick Lamar are the big winners at the Grammys.

It's Monday, February 3rd. This is Reuters World News, bringing you everything you need to know from the front lines in 10 minutes every weekday. I'm Tara Oakes in Liverpool. Ryan Reynolds here from Mint Mobile. The message for everyone paying big wireless way too much. Please, for the love of everything good in this world, stop. With Mint, you can get premium wireless for just $15 a month. Of course, if you enjoy overpaying, no judgments, but that's weird. Okay, one judgment.

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Canadian Prime Minister Justin Trudeau following President Donald Trump's ordering of sweeping tariffs that are set to begin on Tuesday. Canada says it will take legal action to challenge them and has called for a boycott of U.S. products. Beijing has denounced the 10% tariff on Chinese imports but has left the door open for talks.

China's also threatened countermeasures, something promised by Mexican President Claudia Sheinbaum, too. Rejecting as slander the White House's allegation that drug cartels have an alliance with the Mexican government. Trump himself says the sweeping tariffs may cause short-term pain for Americans.

He has talks scheduled today with the leaders of Canada and Mexico, but has downplayed expectations that they would change his mind. Europe breaking news correspondent for finance and markets, Alan John, is here with the market reaction so far.

There's been a pretty dramatic reaction in European and Asian trading so far today. Also a pretty clear and sustained reaction really across lots of things. What's been happening is people have been selling shares and people have been buying the dollar against almost every other currency. US S&P 500 futures are down about 1.5%. That's not Armageddon. It's a move we'd see on a dramatic day.

And then in currencies, probably actually the moves are slightly larger. We've got the dollars up about 1% on the Canadian dollar. That's quite a big move in currency terms. But also, perhaps most dramatically, that's the Canadian dollar at its weakest against the US dollar in over 20 years. Euro's down about 1%. And again, that's a pretty solid move in currency. Why have we seen these reactions today? Trump did talk a lot about tariffs on the campaign trail.

The first and the most important is that the scale of the tariffs are at the top end of what investors were expecting. It feels like it's going to be well over $1 trillion worth of imports to the US that are now going to be tariffed. Secondly, investors are saying it's a little bit hard to see how negotiations follow from this. And so it feels like they're going to have to live with these tariffs for a while. And probably the third reason is that investors are

took some optimism from Trump's early remarks and trade and tariffs didn't appear to be the priority. It wasn't the focus of those remarks. And so now everyone's suddenly reassessing or reassessing their reassessment almost. And that's why we've seen this quite large reaction today. USAID will shut down. That's according to Elon Musk. The world's single largest aid donor is on the chopping block as part of his effort to shrink the federal government.

In a conversation on his platform X, Musk said the U.S. Agency for International Development is beyond repair and says his boss agrees with him. FBI officials have been ordered to fill out a questionnaire about any role they played in investigations into the January 6 attack on the Capitol.

Their answers are due by 3 p.m. Eastern today. Democrats and other critics say Trump's team is carrying out a purge of FBI and Justice Department officials who worked on the criminal cases against Trump and his supporters. At least four Palestinians have been wounded in an Israeli strike on a vehicle on the coastal road in the central Gaza Strip.

The Israeli military says they fired on a suspicious vehicle moving towards northern Gaza, outside the inspection route specified by the ceasefire agreement. Hamas has described the incident as a violation of the truce. And Spanish World Cup winner Jenny Hermoso is due to testify today in the trial of the former Soccer Federation boss over the kiss that triggered a national MeToo movement.

Louis Rubiales is accused of sexual assault, plus trying to coerce Hermoso into saying that the kiss had been consensual. Now, over in Panama, Secretary of State Marco Rubio has used his first visit since taking office to warn the president to end what Trump sees as China's influence and control over the Panama Canal. China is operating the Panama Canal, and we didn't give it to China. We gave it to Panama, and we're taking it back.

Reporter Simon Lewis has been travelling with Rubio. I think the message is sort of putting the Panamanian government on notice in terms of Chinese involvement around the canal, basically saying, we think this is a breach of the treaty we signed with you to give you control of this canal and we want you to do something about it. I think it's not explicit what the US is threatening to do exactly.

But Trump has already shown with Colombia and also with tariffs against Canada and Mexico that he's willing to take quite extreme measures, measures that experts would say will impact the US economy and US consumers as well, to get countries to do what he wants.

Some Panamanians have protested Rubio's visit. How is President Molina responding to Rubio's threat? The Panamanian government have said the sovereignty over the canal is not up for talks here. They have said, you know, we'll look at Chinese companies who are involved. We'll review those kind of things. The president, after meeting Rubio, did say that he could bring to an end quicker than expected the

Panama's involvement in China's Belt and Road Initiative. So that suggests they are willing to show some flexibility. Perhaps Panama knows what it might have to do in order to assuage these concerns that are coming out of Washington. Curbing the deadly opioid fentanyl is one of the justifications Trump has given for his sweeping tariffs. Across the US, fentanyl overdose deaths have actually dropped significantly in the last year.

But for one indigenous reservation in New Mexico, the trend is heading drastically in the opposite direction. Deaths increased by 306% in 2024. And as our reporter Andrew Hay learned when he visited, solving the overdose epidemic there is a complicated situation.

The Alamo Navajo Reservation is extremely isolated. To get there, you have to traverse miles of dirt track that becomes impassable after rain or snow and is pretty gnarly. And this is a blessing and a curse. It means that they have kept their culture intact, but this isolation has meant that it became a sort of haven for drug dealing.

I talked with one man on the reservation. He's called Manuel Güero and he is a jeweler and a musician. His grandson Ambrose died of a fentanyl overdose 125 yards from his home underneath the tree and it pretty much nearly took the family apart. Even though if the other person didn't do it but

I used to blame them. And the untold story of the epidemic, it's what it does to families. It unravels the social structure of the reservation, which is strong, but is really facing its ultimate test with this fentanyl epidemic. How is the reservation trying to reverse this trend? So they're trying to get more detox centres, support for these families that are looking after the children of addicts, treatment centres,

and law enforcement because really without any police presence it is just a sort of haven for dealers who are both tribal members and are from off the reservation.

I did find a man who is up in the north of New Mexico, a tribal member called Myron Apachito. I begin a new life here. And he has had success. He did seven months in rehab and

He is now working and Myron knows that he has to stay away. His family is telling him to stay away from the reservation. So he doesn't have that access to drugs that he would have immediately if he went back to the reservation. And to the Grammys in Los Angeles for today's Recommended Read.

The event was revamped to be part award show and part fundraiser for those affected by the wildfires. Many of the performances paid tribute and the show opened with an all-star rendition of I Love LA. Beyonce won Album of the Year for Cowboy Carter and Kendrick Lamar took Record and Song of the Year for Not Like Us. For more on the winners and highlights from the night, click on the link in the pod description.

And for more on any of the stories from today, check out Reuters.com or the Reuters app. Don't forget to follow us on your favorite podcast player. And we'll be back tomorrow with our daily headline show.