Trump Delays Tariffs on $20 Billion of Canadian Goods

US President Donald Trump has delayed tariffs on $20 billion worth of Canadian goods for three days, giving Canada more time to negotiate a bilateral trade deal. The deadline for the duties was set to expire at midnight Tuesday, but Trump announced the postponement via Truth Social about two hours before they were due to take effect.

According to a White House proclamation, senior executive branch officials have been informed that Canada has agreed to remove what Washington considers discriminatory treatment of US alcoholic beverages, cheese, and motor vehicles. A source with knowledge of the forthcoming agreement told CBC News that US tariffs on Canadian steel and aluminum are being lowered from 50 percent to 25 percent.

The new auto rate would fall from 25 percent to 15 percent for Canadian-built cars and trucks, but this reduction would only apply to the non-US content in vehicles exported from Canada. Two industry sources told Reuters that the lower steel rate would apply up to a quota of 4 million metric tonnes per year, with volumes above that facing the original 50 percent rate.

Analysts have estimated the tariffs could cut annual real GDP growth by around 0.5 percentage points if implemented in full, although the Bank of Canada had projected GDP growth rising from 0.7 percent in 2026 to about 1.8 percent in 2027 and 2028.