The tariffs are being imposed in retaliation to a recent move by Ontario’s provincial government, which placed a 25% tax on electricity exports to the United States. Trump took to social media platform, Truth Social, declaring that the new duties on steel and aluminium imports from Canada are a direct response to Ontario’s actions.
Trump raises tariffs on Canadian Steel and Aluminum to 50%
“Based on Ontario, Canada, placing a 25% Tariff on ‘Electricity’ coming into the United States, I have instructed my Secretary of Commerce to add an ADDITIONAL 25% Tariff, bringing the total to 50%, on all STEEL and ALUMINUM coming into the United States from Canada, ONE OF THE HIGHEST TARIFFING NATIONS ANYWHERE IN THE WORLD,” Trump posted on the platform.
Adding more fuel to the fire amid simmering tensions between the US and Canada, with Trump previously suggesting that Canada should be absorbed into the US as the “Fifty First State,” the US president’s remarks have further complicated the economic ties between the two countries.
Ontario Premier Doug Ford to Trump: ‘We won’t back down’
In response to Trump’s announcement, Ontario Premier Doug Ford stood firm on his province’s decision to impose tariffs on US energy. Speaking on CNBC’s Money Movers, Ford stated, “We will not back down. We will be relentless.” He also expressed his discontent with Trump’s move, calling it an “unprovoked attack on our country, on families, on jobs, and it’s unacceptable.”
Ford further warned that he was prepared to cut off Ontario’s energy supply to the US if Trump continued to target Canadian families. “I won’t hesitate to do that,” Ford said, though he added, “That’s the last thing I want to do.”
The latest flare-up follows a series of trade conflicts between the US and its North American neighbours, with Trump having previously imposed tariffs on Canadian and Mexican goods earlier in the year. While these tariffs were delayed for a short period, they have been reintroduced, further adding to the already tense trade environment.
Trump has not yet signed the formal paperwork to raise tariffs on Canada’s steel and aluminum, but the order is “in the works,” a CNBC report quoted a senior administration official as saying.
How have US stocks reacted to the latest Trump tariffs?
As expected, the US stock markets reacted negatively to the news with the Dow Jones Industrial Average (DJIA) extending losses, dropping over 500 points, while the S&P 500 declined by 0.8% and the tech-heavy Nasdaq Composite fell by 0.4%. The Street sentiment ebbed as broader concerns about the economic implications of rising protectionist measures amid fears of a looming recession.
Closer at home, the BSE Sensex recovered most of its losses but ended marginally down by 12.85 points or 0.02% at 74,102.32 after a volatile session. It had initially dropped by 451.57 points due to weak global trends before bouncing back, aided by late buying in stocks like ICICI Bank, Reliance, and Airtel. The Nifty closed up by 37.60 points or 0.17% at 22,497.90.
Asian markets showed mixed results, with Tokyo and Seoul ending lower, while Shanghai remained positive. US markets had plunged 4% in the previous session, and global oil prices rose by 0.71% to $69.77 per barrel.
