The Trade Conflict Between Canada and the United States Is Intensifying

The failure of trade negotiations between Canada and the United States has resulted in the imposition of 50% tariffs on products representing approximately 5% of Canadian exports to the United States that had previously been exempt under CUSMA. Canadian retaliatory tariffs ranging from 15% to 50%, depending on the product category, on nearly C$28B of imports from the United States will also add pressure to our economy as of September 8, 2026, by reducing consumers’ purchasing power, squeezing some corporate profit margins and boosting inflation. As a result, Canada’s average effective tariff rate on imports from the United States could rise from 2.8% to 6.4%.