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Canada’s economy in flux as Trump starts cutting tariff deals

  • U.S. President Donald Trump began easing tariffs on some imports, including Canadian goods, starting in early April 2025 amid ongoing trade tensions at the U.S.-Canada border.
  • Trump’s tariff reductions followed earlier threats and steep tariffs, especially targeting Canada, which had faced a 25-per-cent tariff since March but now benefits from exemptions under USMCA rules of origin.
  • Despite tariff reliefs, Canada’s manufacturing sector saw 30,000 job losses and a 1.4-per-cent drop in manufacturing sales, while businesses delayed investment due to persistent economic uncertainty.
  • Tony Stillo of Oxford Economics forecasts a three-quarter recession with 100,000 job losses by Q3, while TD’s Beata Caranci notes markets rebounded but Canadian sentiment worsened, directly matching economic data.
  • Tariff reductions and softened countermeasures may ease inflation and supply disruptions, but Canada’s trade-dependent economy remains vulnerable to future tariff risks and uncertainty pending U.S. Policy shifts.
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Trump and the Economy

The policies promoted by the US president are more about preserving the country's status as a leading power than about making the country "great again."

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  • 50% of the sources are Center, 50% of the sources lean Right
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The Globe & Mail broke the news in Canada on Friday, May 16, 2025.
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