Trump threatens Canadian tariffs amid trade tension
President Donald Trump announced the possibility of imposing new tariffs on Canadian lumber and dairy products. According to CNN Business, Trump accused Canada of unfair trading practices, pointing to a 241% tariff on American dairy products.
Trump announced that the new tariffs could be introduced as early as this Friday. The President stated that the United States would respond to Canadian tariffs in equal measure.
- Canada has been ripping us off for years on lumber and on dairy products - said Trump at the White House. - We’re going to charge the same thing. It’s not fair. It never has been fair, and they’ve treated our farmers badly - he added.
Market reactions
The announcement of new tariffs caused uncertainty in the markets. After the initial drop, the Dow Jones index rose by 0.1%, while the S&P 500 and Nasdaq recorded slight declines. Michael Block, a market strategist at Third Seven Capital, noted that Trump's trade policy creates confusion among investors.
The new tariffs could exacerbate the economic problems in the US, such as rising unemployment and inflation. Canadian tariffs on dairy products, including a 241% tariff on milk, have long been opposed by American farmers. Senator Tammy Baldwin from Wisconsin criticised the trade panel's decision that supported Canada in 2023.
For several weeks, Trump has been criticising Canadian tariffs on American lumber. Experts warn that the new tariffs could raise home building costs in the US. America imports about 30% of its timber from Canada, and additional tariffs could deepen the housing availability crisis.
