The US-Canada battle over tariffs has escalated, with both sides digging in; new US duties took effect Saturday, and Prime Minister Mark Carney said the Americans can expect a like action now that the neighbors are “at war.” US Trade Representative Jamieson Greer said that no new talks are planned and that the US is moving on. The US economy could feel the effects. Economists warn the bigger risk isn’t the immediate hit—tariffs still touch only a slice of the two nations’ trade—but the uncertainty, the New York Times reports.
Constant shifts in tariff policy have already rattled markets, strained alliances, and nudged consumer prices higher. Further escalation, analysts said, could chill cross-border investment, weigh on manufacturing, and complicate the Federal Reserve’s inflation fight, with Canada expected to target politically sensitive areas like autos. “Nearly all industries and professions are likely to see downstream effects from this spiraling trade dispute,” said Augustine Lo, whose law firm advises clients on international trade, per the AP. Some lawmakers, including Democratic Sen. Peter Welch of Vermont, blasting the move as a blow to border-state businesses. Others said this impasse could end up following the familiar Trump administration script: brinkmanship now, deal later.