Canada Matches US Tariffs Amid Escalating Trade Tensions
Canada's Prime Minister Carney has announced that Canada will match US tariffs dollar for dollar in response to ongoing trade tensions. The decision comes after weeks of negotiations between the two countries, with Ottawa accusing Washington of rewriting terms at the eleventh hour and being unreliable. According to Carney, Canada waited until the final moments to demand tariff relief on medium and heavy trucks, which is disputed by US officials who claim Ottawa delayed its response.
The Canadian dollar dropped in reaction to the news, trading at 1.3764 against the US dollar. The move also had an impact on oil prices, with WTI oil trading sideways in a $84.71-$86.56 range despite Iran's threat to halt all of its oil exports and push WTI towards $100/b.
The US Treasury Secretary is set to announce sanctions on Iran, which has sparked fresh risk aversion and put a lid on FX trading activity. The move also comes as the global market reacts to Bessent's failed bond-buy back plan, which has left investors cautious.