Canadian businesses and consumers are watching closely as the August 19 deadline approaches for US President Donald Trump’s proposed 50% tariffs on a range of Canadian goods and services.
The proposed duties could affect almost US$20 billion worth of Canadian exports, including dairy products, clothing and other goods. Unlike some of Trump’s earlier tariffs, the latest measures would also apply to products that currently meet the requirements of the Canada-United States-Mexico Agreement (CUSMA).
Canadian officials have spent the past week in Washington, D.C., holding discussions with their US counterparts in an attempt to reach a new trade arrangement and prevent the tariffs from taking effect.
With no agreement announced so far, uncertainty continues to weigh on businesses on both sides of the border.
However, early indications suggest Canadian companies are not rushing to send goods into the US before the deadline. Instead, many appear to be adopting a cautious approach and waiting to see whether negotiations produce a last-minute solution.
Some political and market analysts believe Trump could ultimately withdraw or delay the proposed tariffs shortly before the deadline. Investors have dubbed the pattern “TACO,” an acronym for “Trump Always Chickens Out.”
The tariff uncertainty comes as Canada’s benchmark Toronto Stock Exchange continues to perform strongly. The S&P/TSX Composite Index reached an all-time intraday high of 36,763.81 on August 13 before closing at a record 36,759.29.
For now, Canadian businesses remain focused on the negotiations in Washington as they await clarity on whether the 50% tariffs will come into force on August 19.
