Canada’s government signals readiness to negotiate but warns of potential retaliation as new US tariffs heighten trade tensions under CUSMA.
Canada will intensify trade negotiations with the US after Washington imposed a 50% tariff on a range of Canadian goods, Prime Minister Mark Carney said. The move follows a series of unilateral US trade actions that Carney called violations of the CUSMA agreement, though he emphasized Canada’s preference for dialogue over immediate retaliation.
Carney noted Canada has only matched US tariffs, including in the auto sector, and has submitted detailed proposals to resolve the dispute. The government has also signed over 20 new economic and security partnerships, aiming to diversify trade relationships amid the standoff. Markets reacted with modest CAD weakness, reflecting broader concerns over prolonged trade friction.
The Canadian dollar extended losses on the announcement, though Carney’s measured tone may limit further downside for now. Investors remain cautious, awaiting signs of whether Ottawa will escalate countermeasures in response to the latest US duties.