US-Canada trade war: Big shock to markets

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Business Mar 4, 2025 8 Add to Reading List

US-Canada trade war: Big shock to markets

US President Donald Trump has once again proven that he will not back down from enforcing his rules. His latest decision has further escalated the US-Canada trade war .

The US
has imposed heavy tariffs on imports from Mexico, Canada and China since Trump took office, announcing a 25% tariff on Canada , while it has announced a 10% tariff on Chinese goods. China has challenged the US actions at the World Trade Organization (WTO) and is preparing to impose counter-tariffs of the same level.

Canada's strong response to the US decision
In response to Trump's decision, the Canadian government has announced a major response to American products.
Canadian Prime Minister Justin Trudeau announced that it will impose 25% tariffs on $20.6 billion worth of products imported from the United States. He said that if Trump does not back down, an additional tariff of $125 billion worth of products will be imposed in a second phase in three weeks.These tariffs will affect cars, trucks, steel, and aluminum.Such as.
Severe impact on markets
Global markets have been hit hard by Trump's latest actions.
Along with the decline in the value of the Canadian dollar, stock markets have suffered huge losses.
The Bank of Canada has warned that if the tariff war continues for a long time, Canadian production could decline by up to 3%.
Impact on trade relations
The value of US-Canada bilateral trade has reached $900 billion.
The latest restrictions are likely to seriously affect trade relations between the two countries.
Experts say that American farmers and business communities are already in a position to face the impact of these tariffs. Economists predict that the high tariffs imposed by Trump may disrupt global trade. With the possibility of increasing inflation, this is likely to have a direct impact on the American people. Analysts say that these conditions were warned by economists even before Trump's election.
What will happen next?
There is interest in whether Trump will continue with his decision or back down.
Will Canada take more drastic measures? Business circles around the world are concerned about this. Analysts predict that if this trade war continues, its impact on international markets could worsen.