U.S. President Donald Trump said 25% tariffs on goods from Mexico and Canada will take effect from Tuesday, pushing North America closer to a regional trade war and sending financial markets reeling.

Trump's comments made on Monday triggered a selloff in global stocks and pushed bond yields lower. The Mexican peso and Canadian dollar both fell following his remarks.

"They're going to have to have a tariff. So what they have to do is build their car plants, frankly, and other things in the United States, in which case they have no tariffs," Trump said at the White House.