Noticeably absent from the agreement was Canada, one of America's top trading partners.

In an Oval Office phone call with Mexican President Nieto, President Trump explained his reasons for renegotiating the North American Free Trade Agreement, including dropping the name NAFTA.

"I like to call this the United States-Mexico Trade Agreement. I think it's an elegant name. I think NAFTA has a lot of bad connotations for the United States because it was a rip-off. It was a deal that was a horrible deal for our country," he said.

Economists like the Heritage Foundation's Stephen Moore expressed surprise.

"If you had asked me six months ago are we going to get a trade deal with Mexico before Canada? I would have said it was so improbable, but here we are," Moore said.

The new agreement with Mexico provides zero tariffs on agricultural products. It also requires that 75 percent of the parts of cars sold in North America be produced in the US or Mexico.

In addition, 40 to 45 percent of the parts of cars sold must be made by employees making at least $16 per hour.

News of the deal gave an already strong economy a shot in the arm as the Nasdaq and the S&P 500 jumped to record highs.

President Trump said negotiations to bring Canada into the new deal should start soon.

"If they would like to negotiate fairly we will do that. You know they have tariffs of almost 300 percent on some of our dairy products, we can't have that. We're not going to stand for that. I think with Canada the easiest things we can do is tariff their cars coming in," Trump insisted.

But some economists argue hefty tariffs on cars and other products could lead to a trade war that may only harm a booming US economy.

"If you want free and fair trade with a level playing field, let's get the tariffs down. The United States will benefit for that because we already have the lowest tariffs," Moore told CBN News.

Moore and others say the US-Mexico agreement jumpstarts prospects for a negotiated deal with the Europeans and gives an upper hand in negotiations with China.

News of this deal comes as the US economy is seeing record low unemployment and rapid growth. (Screengrab via CBN News)

The Atlanta Federal Reserve reports the economy so far in the third quarter is growing at 4.8 percent—the fastest rate in 20 years.

President Trump has criticized the Fed for raising interest rates and Moore explained why the president is frustrated.

He said, "The Fed seems wanting to take the punch bowl away from this party. And I happen to agree with him. I don't see a lot of signs of inflation out there right now."

Still to be done to keep the economy moving forward? Moore says a wage hike is needed to bring more help to middle class workers. Subscribe for free to Breaking Christian News here.

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