Tariffs live updates: Trudeau says Canada will not back down from trade fight

Written by Globe staff on March 4, 2025. Posted in Canada.

Prime Minister Justin Trudeau speaks at a news conference in response to U.S. tariffs on Canada, on Parliament Hill in Ottawa on Tuesday, March 4, 2025.Justin Tang/The Globe and Mail

1:52 p.m.

Canada, Mexico, China must prove they can stop fentanyl coming into U.S., Lutnick says

– Nathan VanderKlippe

President Donald Trump speaks during a ceremonial swearing-in for Secretary of Commerce Howard Lutnick in the Oval Office of the White House in Washington on Friday, Feb. 21, 2025.The Associated Press

Canada, Mexico and China must prove they can stop fentanyl coming into the U.S. if they want relief from tariffs, U.S. Commerce Secretary Howard Lutnick said Tuesday.

“The current tariff policy is a drug-related policy. There’s opioids pouring into this country. They’re killing about 75,000 autopsied Americans a year,” Mr. Lutnick told CNBC’s Squawk Box.

His comments mark the latest in a series of conflicting remarks from the Trump administration, which has at times said the 25-per-cent tariffs are related to narcotics and immigration – and at other times raised grievances related to trade and access to Canadian markets for U.S. banks.

“China makes the opioid products, and then Mexico and Canada feed them into America, and that’s got to end. They’ve done a nice job on the border, but they haven’t stopped the flow of fentanyl,” he said.

He suggested that the U.S. could relent if it sees progress, but offered no indication of how that would be evaluated.

1:51 p.m.

Canadian energy stocks fall as tariffs hit U.S. shipments

– Jeffrey Jones

Canadian oil and gas stocks dropped after U.S. President Donald Trump imposed tariffs on the export-dependent sector and OPEC signaled it will soon boost production.

The S&P/TSX capped energy index was down 1.4 per cent on Tuesday to its lowest in more than a year. The group bounced from a steeper drop early in the session, as investors digested the impact of Mr. Trump’s 10 per cent import duty on Canadian energy.

Among the Industry’s big names, Suncor Energy Inc. was down 3 per cent, Cenovus Energy Inc. was off 2.8 per cent and Canadian Natural Resources Ltd. fell 1 per cent.

Before this week, some investors still held onto the hope that the U.S. might exempt Canadian energy from tariffs, but when it became clear that wouldn’t happen, many winnowed down their stocks, said Jeremy McCrea, analyst at Bank of Montreal. In addition, the prospect of higher production from OPEC members and their allies starting in April have weighed on oil prices.

Providing some support, however, was just a small widening of the discount between Western Canadian Select heavy oil and U.S. benchmark crude, Mr. McCrea said. That, and the weak Canadian dollar, could temper the impact on producers.

1:49 p.m.

Tariffs will add thousands of dollars to the price of new cars

– Erica Alini

A car waits at the United States and Canada border in Surrey B.C., on Tuesday, March 4, 2025.ETHAN CAIRNS/The Canadian Press

Tariffs will add thousands of dollars to the price of new cars for both Canadians and Americans, one of the most palpable impacts of a prolonged trade war.

A 25-per-cent U.S. tariff on Canadian imports, coupled with equivalent retaliatory duties imposed by Ottawa on American goods, could increase the price of new vehicles in Canada by an average of $5,000 to $6,000, according to estimates by research firm J.D. Power.

In the U.S., prices there are likely to climb by an average of US$2,600 (around $3,760) per vehicle, according to the same analysis.

There are sharp differences in how prices are likely to change depending on make and model, said Robert Karwel, director of customer success at J.D. Power in Canada.

U.S. auto carmarkers General Motors, Ford, and Stellantis, along with Japan’s Toyota, Honda and Nissan, which have built extensive supply chains in North America, would bear the biggest hit from tariffs, he said.

1:46 p.m.

Opinion: Poilievre’s unity message to Canada

– Shannon Proudfoot

Pierre Poilievre started off with a unity message about how Canadians must be feeling scared right now about the effects of the tariffs, and he vowed to fight for them on every front.

But then he snapped right back to his same message about all the things that have gone awry in Canada under the Liberal government. Much of what he said was indistinguishable from any speech or policy prescription he might have offered before the U.S. election.

“All these things – axing taxes, building homes, unleashing construction of our resources, fixing the budget, stopping crime – all of these things were Conservative fixations before the tariffs,” Poilievre said. “Now they are even more necessary.”

I wrote a piece last weekend about how circumstances have yanked the rug out from under the Conservatives. It looks like Poilievre is struggling to find a response to the moment he finds palatable.

1:43 p.m.

‘Nobody wins in a trade war‘: President of Calgary Economic Development

– Emma Graney

Canada still doesn’t know the full cost of tariffs imposed by the United States, but “nobody wins in a trade war,” says Brad Parry, the president and chief executive of Calgary Economic Development.

Regardless of the impact, the tariffs imposed by the country’s largest trading partner will threaten jobs and investment in Calgary and across the country, Mr. Parry said in a statement.

Now, more than ever, Alberta’s largest city must focus on diversifying its economy by attracting new companies, opening new markets within Canada and abroad, and supporting local companies to help them scale, he said.

“We are about to enter a very challenging period. But I am confident we can navigate these turbulent times, build economic resilience and emerge stronger as a city.”

1:40 p.m.

Tariffs are proof Canada must shift away from heavy reliance on U.S. trade, Pembina Institute says

– Emma Graney

Tariffs prove that Canada’s economy must “fundamentally change” from being heavily reliant on trade with the U.S., and look to clean energy production to help insulate itself from future external price shocks, the Pembina Institute, an environmental think tank, said in a statement.

“Canada, with its abundant natural resources – including its ability to generate lots of clean, low-cost electricity to power the industries of the future – has the preconditions to thrive in this emerging clean economy,” Chris Severson-Baker, the executive director, said.

“Given the rollback of climate and energy policies in the U.S., Canada can compete for billions in capital by bolstering its attractiveness as an investment destination for low-carbon industries.”

Mr. Severson-Baker also urged governments and industry to avoid “knee-jerk reactions” like expanding oil and gas infrastructure.

“We must be strategic and responsible about which projects and industries are developed – recognizing that the global shift to low-carbon energy will simultaneously address energy security and affordability concerns.”

1:38 p.m.

Why the tariffs could drive up Canadians’ auto insurance premiums

– Erica Alini

A prolonged trade war could result in higher insurance premiums for drivers as tariffs increase the cost of new vehicles and auto parts.Fred Lum/The Globe and Mail

A prolonged trade conflict could result in higher insurance premiums for drivers as tariffs increase the cost of new vehicles and auto parts, making it more expensive for insurers to cover repairs and replacements after accidents.

Physical damage to vehicles is only part of auto insurers’ total expenses for auto claims, which also include labour costs and covering losses such as injury or death. But both private and public providers of auto insurance in Canada are already discussing the possibility of hiking up rates because of the tariffs, as my colleague Mariya Postelnyak and I reported this week.

Ontario, Nova Scotia and New Brunswick said they have received some preliminary inquiries from the industry about the possibility of bumping up rates because of tariffs.

Among provinces with public insurance, the Insurance Corporation of British Columbia and Saskatchewan Government Insurance said they are looking into the potential impact of tariffs but added that it’s too soon to tell what that will be.

However, no provincial insurance regulator or public insurer said rate changes linked to the trade duties are planned or imminent.

1:36 p.m.

CIBC CEO Victor Dodig charts how Canada can make its economy stronger in wake of U.S. tariffs

– Bianca Bharti

Victor Dodig, the president and CEO of Canadian Imperial Bank of Commerce, penned an op-ed this morning calling for Canadians to engineer a great comeback.

He said Canada must focus financial capital on the “industries of tomorrow,” such as health care, technology and artificial intelligence, noting that the success the mining industry has seen with flow-through shares should be considered for use in those emerging fields. He also outlined how incentives around education and housing would allow young people to “start here, stay here.”

As for breaking down interprovincial trade barriers, the CIBC leader said a path toward moving infrastructure projects forward, building the Northern economy and consulting with Indigenous communities to develop natural resources is a must in order to “seize this vital moment.”

1:27 p.m.

Trump refers to ‘Governor Trudeau’, reciprocal tariffs against Canada in Truth Social post

– Laura Stone

In a post to Truth Social on Tuesday afternoon, President Donald Trump – again referring to Prime Minister Justin Trudeau as “Governor Trudeau” – said when Canada retaliates against the U.S., the U.S. will add additional tariffs.

“Please explain to Governor Trudeau, of Canada, that when he puts on a Retaliatory Tariff on the U.S., our Reciprocal Tariff will immediately increase by a like amount!” Mr. Trump wrote.

1:24 p.m.

Alberta Premier Danielle Smith calls tariffs an ‘unjustifiable economic attack’

– Emma Graney

Alberta Premier Danielle Smith speaks at a news conference in Calgary on Wednesday, Feb. 19, 2025.Jeff McIntosh/The Canadian Press

Alberta Premier Danielle Smith has called the tariffs an “unjustifiable economic attack on Canadians and Albertans” and a clear breach of the trade agreement signed by President Donald Trump during his first term.

Tariffs are “foolish and a failure in every regard,” she said in a statement, because they will hurt Americans by driving up costs for fuel, food, vehicles and housing while costing hundreds of thousands of jobs on both sides of the border.

“This is not the way it should be between two of the world’s strongest trading allies and partners. We would much rather be working with the U.S. on mutually beneficial trade deals than be caught in the middle of a tariff war.”

She added that Canada should drastically increase its military spending to ensure it can protect itself.

Ms. Smith said she fully supports the federal response announced by Prime Minister Justin Trudeau. Alberta will release its own response on Wednesday.

1:22 p.m.

Saint John mayor reacts to Trump tariffs

– Mike Hager

Saint John may be the Canadian city most exposed to the tariffs due to its major companies depending on cross-border trade, its mayor said Tuesday.

Donna Noade Reardon issued a statement decrying the “sad day for our strong partnership with our neighbours to the south” and noting local companies JDI, Irving Oil, Moosehead Brewery and Cooke Aquaculture export many of their products to the United States.

She noted a recent Canadian Chamber of Commerce report found her city most exposed to these tariffs.

Ms. Reardon added that Saint John will endure this trade war but stressed that Canada needs a national strategy for opening its industries to global markets and removing interprovincial trade barriers.

1:18 p.m.

B.C. to pull American alcohol from store shelves, Premier David Eby says

– Andrea Woo

Trucks wait at the United States and Canada border in Surrey B.C., on Tuesday, March 4, 2025.ETHAN CAIRNS/The Canadian Press

British Columbia is pulling all red-state alcohol from store shelves and prioritizing Canadian companies for government procurement in response to U.S. tariffs, Premier David Eby said Tuesday morning.

“We didn’t ask for this fight that the President has brought to Canada and to British Columbia, but I’ll tell you this: We’re not going to shrink from it,” Mr. Eby said. “If the President wants to hurt Canadians, he wants to hurt British Columbians, then we have no choice but to respond in kind to the United States.”

The Premier said the decision to target red states is deliberate: “We want to send a message, particularly to those governors, those congresspeople, when they hear from their constituents about this, that they have a chance to stand up to the President and to point out that jobs in communities are dependent on a good relationship with Canada.”

He noted that Ottawa has pledged to redistribute revenue from tariffs to affected businesses and individuals, and said B.C. will “fill in the blanks wherever there’s an area of concern that isn’t being addressed by the federal government.”

Vancouver Mayor Ken Sim said in a statement that the city is “directing staff to find new ways to strengthen our economy, support local businesses and keep Vancouver competitive on the global stage.”

With a report from Frances Bula.

1:16 p.m.

Doug Ford to cancel Ontario’s $100-million contract with Starlink

– Jeff Gray

Ontario Premier Doug Ford holds a press conference regarding the new tariffs that the United States has placed on Canada, at Queen’s Park in Toronto on Tuesday, March 4, 2025. THE CANADIAN PRESS/Nathan DenetteNathan Denette/The Canadian Press

Ontario Premier Doug Ford said he is cancelling the province’s $100-million contract for rural and remote satellite internet with Starlink, a company controlled by billionaire Elon Musk, to protest U.S. tariffs.

“We’re ripping up Ontario’s contract with Starlink. It’s done. It’s gone,” Mr. Ford told reporters at a press conference near the Ontario Legislature. “We won’t award contacts to people who enable and encourage economic attacks on our province and our country.”

He said he did not know how much any break fee in the contract would cost taxpayers.

He also noted that Mr. Musk, a Canadian citizen and key ally of U.S. President Donald Trump, attended Ontario’s publicly funded Queen’s University in Kingston: “Part of his education was at Queen’s and he’s attacking the country and the province that gave him the opportunity to go to Queen’s.”

Mr. Ford has faced calls, including from Liberal Leader Bonnie Crombie, to drop the contract for weeks, and initially announced he would do so last month before putting the cancellation on pause when Mr. Trump put his tariffs on hold.

1:13 p.m.

Presidential counselor says ‘Trump is going to put America first’

– Laura Stone

Alina Habba, a counselor to U.S. President Donald Trump, told White House reporters on Tuesday that she doesn’t blame countries for being frustrated about tariffs.

“They’ve had it really easy under our old administration,” she said.

“President Trump is going to put America first, and by doing so, he’s sending a strong message that people need to recognize that if you’re going to hurt us economically… we’re just going to be fair and say you’re going to get the same thing back.”

Ms. Habba said it’s “uncomfortable” for countries that are used to getting what they want from the U.S. She was asked about Mr. Trump’s Truth Social post Tuesday in which he said if companies move to the U.S., there will be no tariffs.

She said the message is to build in the U.S., notably cars.

“Bring your business, build your factories in America, and you will be treated kindly,” she said.

1:06 p.m.

Protesters gather in front of the U.S. embassy in Ottawa

– Claire Donnan

People rally across the street from the Embassy of the United States of America in Ottawa, in response to U.S. tariffs on Canada, on Tuesday, March 4, 2025.Justin Tang/The Globe and Mail

Dozens of protesters gathered at noon in front of the U.S. embassy in Ottawa to object to the U.S. tariffs as Bonnie Tyler’s Holding Out for a Hero blared from speakers.

“I used to live in Windsor, Ontario, and I worked a lot in the U.S.,” said Fred May, who attended the rally. “You can’t come along and just throw the whole world upside down like this.”

Protesters waved several different flags, including Canadian, Ukrainian, and one upside-down American flag.

“I’m going to be on the right side of history, and I’m going to show my kids that we fight for freedom,” said Crysta Balis, who was holding a sign that said “We serve poutine, not Putin.”

1:03 p.m.

Manitoba pulls American alcohol products from provincial liquor stores

– Temur Durrani

Workers install a giant Canadian flag on the front of the Manitoba legislative building in Winnipeg on Tuesday, Mar. 4, 2025.Steve Lambert/The Canadian Press

Manitoba is pulling American alcohol products from the shelves of its provincial liquor stores as part of a series of retaliatory moves Premier Wab Kinew plans to announce against U.S. President Donald Trump’s tariffs on Canada this week.

Mr. Kinew will also launch tax deferrals for Manitoba businesses affected by the U.S. tariffs. Starting from the February tax period, for at least three months, Manitoba will allow companies to opt out of its health and post-secondary levies on payroll tax, along with the retail sales tax.

The new moves, confirmed to The Globe and Mail by Mr. Kinew’s spokesperson, Ryan Stelter, will be detailed at a press conference held Tuesday afternoon outside the Manitoba legislature.

“We’re going to keep fighting for your families and our economy,” Mr. Kinew said in a statement. “We are protecting your Manitoba jobs.”

Manitoba Liquor & Lotteries said that at least 6 per cent of all Crown corporation alcohol products come from the U.S.

12:57 p.m.

Poilievre says Americans will pay the price for Trump’s tariffs

-Stephanie Levitz

Conservative Leader Pierre Poilievre holds a news conference in Ottawa on Tuesday, March 4, 2025.Adrian Wyld/The Canadian Press

Conservative Leader Pierre Poilievre said Americans will pay the price for Mr. Trump’s tariffs.

Uncharacteristically speaking in part off prepared remarks at a press conference in Ottawa on Tuesday, he said American jobs will be lost, costs will go up and the U.S. will lose access to crucial Canadian products.

In a message to Canadian workers, he said that times have already been tough, citing rising rent and home prices and the cost of groceries.

“I’m here with a message of hope,” Mr. Poilievre said. “We will overcome this attack on our economy.”

He said countertariffs must be imposed and that those proceeds must go toward reducing taxes as well as setting aside a “small sum” to support workers.

The Conservative Leader also called for a major tax cut to “neutralize” the cost of the tariffs with lower taxes and to incentivize investment in Canada.

Mr. Poilievre noted that Parliament isn’t sitting because of the current Liberal leadership race, so little he is calling for can get done.

“We need change and we will get change,” Mr. Poilievre said.

12:35 p.m.

Aluminum manufacturer to close Quebec plant following Trump tariffs

– Nicolas Van Praet

U.S. President Donald Trump’s trade war against Canada appears to have yielded a first industrial victim in Quebec.

Brazil’s Alubar Metal, the largest manufacturer of aluminum electrical cables in Latin America, has announced it will close its factory in Bécancour, Que., following the implementation of U.S. import tariffs on Canadian products, the union representing 70 workers at the plant said Tuesday.

“This morning we’re the first to get a punch to the face and we need help,” Syndicat des Métallos local president Jessy Trottier said in a statement. “People have been talking for weeks about measures to support the economy. So what’s the plan?”

Efforts to get confirmation from Alubar on its intentions were not immediately successful. An official with the corporation that runs Bécancour’s industrial park said they were also waiting for more information.

Alubar’s Bécancour production is almost entirely shipped to the United States, the union said.

12:27 p.m.

Freeland says dollar-for-dollar retaliation is required

-Stephanie Levitz

Former finance minister and deputy prime minister Chrystia Freeland called the tariffs “an act of self-mutilation by the United States.”

In a statement issued Tuesday morning, she said dollar-for-dollar retaliation is required, and if she’s named Liberal leader in the race that ends Sunday her government would use all proceeds to support Canadian workers and businesses.

Ms. Freeland also took aim at Elon Musk, one of Mr. Trump’s close advisers, and his companies.

“My government will ban Tesla, X (formerly Twitter), Starlink, and SpaceX from receiving any current or future federal procurement, subsidies, or incentives – building on my plan for a 100-per-cent tariff on Teslas,” she wrote.

“We will encourage all provinces, territories, and municipalities to join us in this measure.”

11:58 a.m.

Canadian Labour Congress asks for enhanced EI benefits and other supports

-Vanmala Subramaniam

The Canadian Labour Congress, a conglomerate union representing more than three million workers across the country, is calling on the federal government to provide robust support to Canadian workers who might be impacted by the tariffs.

Specifically, the union is asking Ottawa to enhance Employment Insurance benefits, expand work-sharing programs and provide “direct financial support” to impacted workers.

The federal government’s existing Work-Sharing program is separate from EI benefits and provides income support to workers who have been reduced to part-time work by their employers.

Bea Bruske, the president of the CLC, said that lost economic activity as a result of the trade war should be replaced with “nation-building projects” such as creating affordable housing and investments in public transit.

“We need our governments to match the ambition of Canadians in defence of this country,” she added.

11:43 a.m.

‘We’re going to fight, we’re going to win,’ Trudeau says after declaring Canada is in a trade war

-Stephanie Levitz

The U.S. flag hangs above the ice before the Vancouver Canucks and Colorado Avalanche play an NHL hockey game in Vancouver, on Tuesday, February 4, 2025.DARRYL DYCK/The Canadian Press

Mr. Trudeau was asked by a reporter if he agreed with U.S. investor Warren Buffett, who has called Mr. Trump’s tariffs an act of war.

The Prime Minister said Canadians aren’t angry at the American people, but added: “This is a trade war, yes.”

He said Canadians may still boo the American national anthem at sporting events.

“But let me tell Americans, we’re not booing you. We’re not booing your teams. We’re not booing your players. We’re booing a policy that is designed to hurt us. We’re insulted and we’re angry, but we’re Canadian, which means we’re going to stand up for each other, we’re going to fight, we’re going to win,” he said.

Mr. Trudeau’s press conference has ended. He’s expected to meet with the premiers later Tuesday.

11:38 a.m.

Trudeau’s last day as prime minister to be decided between him and new Liberal leader

-Stephanie Levitz

Mr. Trudeau says the date of his last official day as prime minister will be decided between him and whoever the Liberal Party elects on March 9.

He says it should happen “reasonably quickly” but there are a lot of things to be considered as part of the transition.

Mr. Trudeau announced in January he would step down after his replacement was chosen.

There are four candidates in the running: former Bank of Canada governor Mark Carney, former finance minister Chrystia Freeland, former Liberal House leader Karina Gould and former MP Frank Baylis.

11:36 a.m.

Newfoundland and Labrador will remove U.S. alcohol from stores, deepen connections to Europe, says premier

– Frédérik-Xavier D. Plante

In a statement posted on social media Tuesday, Newfoundland and Labrador Premier Andrew Furey highlighted the province’s ties to the U.S. and denounced the tariffs as unjust and unlawful.

Mr. Furey also detailed some retaliatory measures. The province will be removing U.S. products from public liquor stores and “reviewing and stopping immediately, where possible, procurement from the U.S.,” he said. “Now, more than ever, we should be supporting local and Canadian-made products where possible.”

The Premier also said his province will identify new export markets for local products and deepen its connections with Europe.

11:27 a.m.

Canada exploring support package for Canadians, but goal is to end ‘economic war’

– Stephanie Levitz

Prime Minister Justin Trudeau speaks at a news conference with Minister of Foreign Affairs Melanie Joly, left, Minister of Intergovernmental Affairs Dominic LeBlanc, and Minister of Public Safety David McGuint, on Parliament Hill on March 4, 2025.Justin Tang/The Globe and Mail

The Prime Minister is now taking questions from reporters at the close of his remarks.

Mr. Trudeau says he’s offered to speak with Mr. Trump for several days, but hasn’t recently, and remains open to speaking to him.

Asked in French about a support package for affected Canadians and industries, Mr. Trudeau says the government is exploring options, however the goal is not to find ways for the Canadians to “get through these tough times,” but to prevent those times from lasting longer than they have to.

He says Canada’s priority is to put an end to this “economic war.”

He says the government is also looking at how it can adjust unemployment insurance to support Canadians.

11:26 a.m.

Ontario to implement 25-per-cent tax on electricity exports to U.S., says Ford

-Jeff Gray

Ontario Premier Doug Ford has told The Wall Street Journal that he intends to slap a 25-per-cent tax on his province’s electricity exports to the U.S.

The newspaper also says Mr. Ford will forbid all power exports to the U.S. if Mr. Trump makes good on his threat to impose additional tariffs April 2.

Both are threats Mr. Ford has made repeatedly in recent weeks – including on Monday.

However, Mr. Ford’s Energy Minister has said Ontario will not be able to impose an export charge before the province’s legislature returns, which is expected to happen in about two weeks, as the move requires enabling legislation.

Energy Minister Stephen Lecce told The Globe and Mail on Monday that his officials were planning escalating per-megawatt surcharges on electricity exports, but that this move would only be enacted if the tariffs “escalate” or are “sustained,” Mr. Lecce said.

Cutting off Ontario’s U.S. power exports – which amount to about $700-million worth of electricity a year to New York, Minnesota and Michigan and is enough power for 1.5 million homes – would be a last resort, Mr. Lecce said.

11:22 a.m.

Trudeau to Trump: Canada and U.S. fighting is ‘exactly what our opponents around the world want to see’

– Stephanie Levitz

At his press conference, Prime Minister Justin Trudeau directly addressed U.S. President Donald Trump, noting the big things the two countries have done together over the years.

“This is a very dumb thing to do,” Mr. Trudeau says of the tariffs. “We two friends fighting is exactly what our opponents around the world want to see.”

Mr. Trudeau also directly addressed Americans, saying they are the ones who are going to suffer from the tariffs.

He says the American government has put thousands of American jobs at risk, and will raise costs for Americans on everyday goods like groceries and gas, and harmed national security.

“They’ve chosen to launch a trade war that will, first and foremost, harm American families. They’ve chosen to sabotage their own agenda that was supposed to usher in a new golden age for the United States,” the Prime Minister said.

He also outlined all the measures Canada has taken to curb fentanyl trafficking, saying the pretext the U.S. is using to impose tariffs – that Canada is unwilling to take action on fentanyl – “totally false.”

Prime Minister Justin Trudeau said on Tuesday that Canada will put a 25 per cent tariff on $30-billion worth of U.S. imports in response to tariffs imposed by the Trump administration.

Reuters

11:20 a.m.

Opinion: Linking U.S. tariffs to Putin invokes a shifting world order

– Shannon Proudfoot

From the very top of his remarks today, Justin Trudeau explicitly linked the U.S. tariffs with the Trump administration’s support of “lying, murderous dictator” Vladimir Putin against Ukraine.

The intent seems to be to underline how irrational and extreme President Donald Trump’s behaviour is, that this is not just about tariffs, but rather about wild-eyed aggression from a country that was once a friend and ally to Canada and the world at large.

This seems to be about invoking a fundamental shift in the world order, implicitly making the point that Canada and tariffs today could be any other country’s issue tomorrow.

11:13 a.m.

Quebec job losses could be as high as 160,000, says Legault

– Frédérik-Xavier D. Plante

Quebec Premier François Legault said the province could lose up to 160,000 jobs over the next few months due to across-the-board 25-per-cent tariffs.

In an interview with Radio-Canada Monday night, Mr. Legault said his government would help businesses cope in the short term with liquidity and encourage market diversification plans with public money through Investissement Québec.

He also plans to accelerate hydroelectric project development with the public utility, investing $150 billion and creating “tens of thousands of jobs” in the construction industry. Other public infrastructure projects such as hospitals and transit systems could also be expedited, Mr. Legault said.

The Premier said that no retaliatory measures should be off the table.

“We must be able to make Mr. Trump pay the price for decisions that do not make sense, even for Americans,” he said, citing export taxes or restrictions on products such as energy, aluminum and wood.

11:09 a.m.

Prime Minister Justin Trudeau holds press conference, says Canada will not back down

– Stephanie Levitz

He is telling a news conference that the Canadian tariff response to the U.S. is now in place, and Canada will challenge Mr. Trump’s actions by filing dispute resolution claims at the World Trade Organization and through the Canada-U.S.-Mexico free trade deal.

He says there are active discussions ongoing with provinces and territories to pursue non-tariff measures, which will demonstrate there are no winners in a trade war.

Mr. Trudeau says Canada doesn’t want this war, and wants to work with Americans as a friend and ally.

“We don’t want to see you hurt either but your government has chosen to do this to you.”

11:03 a.m.

Green Party says tariffs are ‘nothing short of a declaration of economic war’

– Bill Curry

The federal Green Party said the U.S. imposition of tariffs on Canadian goods “is nothing short of a declaration of economic war.”

In a statement Tuesday, party co-leaders Elizabeth May and Jonathan Pedneault said the tariffs violate existing trade agreements. The party offered its support for countertariffs on U.S. imports and called on “all political leaders to unite and take immediate action to counter this aggression, for the sake of Canadian workers, businesses, and our national sovereignty.”

11:01 a.m.

How a full-blown trade war will affect economic growth, employment, prices and profits

– Mark Rendell

Transport trucks enter the border crossing at the Ambassador Bridge in Windosr, Ont., on March 4, 2025, the first day of U.S. tariffs being imposed on Canadian goods.Dax Melmer/The Globe and Mail

By placing 25-per-cent tariffs on imports from Canada and Mexico, with lower 10 per cent tariffs for energy and critical minerals, Mr. Trump has shattered decades of continental economic integration. Canada and Mexico will be hit the hardest, but U.S. consumers and businesses will suffer as well.

The extent of the pain will depend on how long the tariffs remain in place, and how much Canada and Mexico retaliate. But a full-blown trade war will affect economic growth, employment, prices and profits in all three countries.

Unless Mr. Trump reverses course quickly, a recession in Canada appears imminent.

Economic modelling by the Bank of Canada shows Canadian exports falling 8.5 per cent in the first year after tariffs are imposed, business investment declining almost 12 per cent and consumer spending contracting by more than 2 per cent by 2027.

“In our January projection with no tariffs, we forecast growth of about 1.8 per cent in both 2025 and 2026. But in the tariff scenario, the level of Canadian output falls almost 3 per cent over two years. That implies tariffs would all but wipe out growth in the economy for those two years,” Bank of Canada Governor Tiff Macklem said in a speech last month.

Private sector and academic economists have published a range of estimates on the effect of U.S. tariffs, but all agree that damage will be significant. From a regional perspective, Ontario and Quebec are the most exposed, while industries such as auto manufacturing, primary metals, food and beverage manufacturing, chemicals, machinery and aerospace will also be hit hard.

10:57 a.m.

Private sector unions call on Ottawa to announce direct support for affected workers

– Vanmala Subramaniam

Major private sector unions have been calling for Ottawa to immediately announce direct support to affected workers as soon as U.S. tariffs hit.

Marty Warren, the national director of United Steelworkers Canada, said the federal government should consider enhancing Employment Insurance, and setting up a wage subsidy program to disincentivize employers from laying off workers.

Mike Van Boekel, chairperson of Unifor Local 88, the union representing 1,300 workers at General Motors’ electric vehicle manufacturing facility in Ingersoll, Ont., told The Globe that the federal government needs to quickly reform its EI system to make it more easily accessible to workers.

GM workers in Ingersoll have been temporarily laid off for almost two weeks because of waning demand for EVs. Mr. Van Boekel predicts that with the compounding effect of tariffs, layoffs could prolong for months. “But everyone is in a bit of a holding pattern right now,” he added.

10:55 a.m.

Michigan mayor braces for fallout from the trade war on local auto industry

– Jason Kirby

The Stellantis sign is seen outside the Chrysler Technology Center, in Auburn Hills, Mich.Carlos Osorio/The Associated Press

Like local officials in many U.S. cities dominated by the automotive industry, Michael Taylor, the mayor of Sterling Heights, Mich., is bracing for fallout from the trade war between the U.S., Canada and Mexico.

The city, which sits roughly 30 kilometres north of Detroit, is home to a large Stellantis assembly plant that produces the RAM 1500 pickup truck, as well as a powertrain manufacturing facility operated by Magna International.

Parts for both companies move back and forth across the Canada-U.S. border multiple times, he said, “so to slap a 25-per-cent tariff on those parts each time is going to be devastating for our companies, for our workers and ultimately for consumers who will be paying thousands of dollars more.”

President Donald Trump easily won Macomb County, home to Sterling Heights, in the November election, taking 55.8 per cent of the vote, up from the 53.4 per cent he received in 2020.

“People here tell me they voted for Trump because they want prices to come down, but these tariffs are going to have the opposite effect,” said Mr. Taylor.

10:49 a.m.

Federal labour minister hints at incoming benefits for workers impacted by tariffs

– Vanmala Subramaniam

Federal labour minister Steven MacKinnon has strongly hinted at incoming benefits for workers impacted by the tariffs, telling reporters in Toronto on Tuesday morning that Ottawa will announce specific measures to help workers exposed to tariffs in the “coming days.”

“We will be relying heavily on the EI system,” Mr. MacKinnon said. “The fact is as bad as this will be, it is not the pandemic, and I think it is important we underscore that fact. That’s why the measures we have designed and the package we have come up with will be tailor-made to the situation we find ourselves in.”

10:40 a.m.

NDP Leader Jagmeet Singh sends open letter, calling for emergency session of Parliament

– Bill Curry

NDP Leader Jagmeet Singh sent an open letter Tuesday to Prime Minister Justin Trudeau, Conservative Leader Pierre Poilievre and Bloc Québécois Leader Yves-François Blanchet calling for an emergency session of Parliament in response to the U.S. tariffs.

“I am writing to you with urgency as our country faces the growing threat of imminent sweeping U.S. tariffs. These tariffs would have devastating consequences for Canadian workers, industries, and families already struggling with the out-of-control cost of living,” he wrote.

Mr. Singh said Parliament should quickly approve a comprehensive package that includes expanding eligibility and enhancing benefits under the Employment Insurance system; emergency funding for infrastructure projects such as housing construction; and emergency support for retaliatory tariffs.

Mr. Singh said that while the government can impose retaliatory tariffs on its own, a show of Parliamentary support for such moves “would send a powerful message to President Trump about our resolve and unity.” He added that

Parliament needs to act before the expected federal election campaign begins.

10:36 a.m.

Doug Ford orders LCBO to immediately remove all U.S. alcohol from its shelves

– Jeff Gray

An LCBO employee moves products in an LCBO store at Union Station in Toronto on Tuesday, March 4, 2025.Laura Proctor/The Canadian Press

Ontarians hoping to buy some American-made booze from the Liquor Control Board of Ontario are officially out of luck as of Tuesday morning.

Ontario Premier Doug Ford repeated his threat on Monday that if U.S. tariffs took effect, he would order the province’s LCBO to immediately remove all U.S. alcohol from its shelves.

His spokeswoman, Grace Lee, confirmed Tuesday morning the directive was in effect. And it appears the work is under way – with online ordering already shut down.

As of Tuesday morning, the LCBO’s website has a “Service Unavailable” error message that reads: “Our site is temporarily unavailable while we remove U.S. products in response to U.S. tariffs on Canadian goods. Our in-store customer service remains unaffected.”

The LCBO, one of the largest purchasers of alcohol in the world, sells about $1-billion worth of U.S. products a year.

10:23 a.m.

BMO Capital Markets revises economic forecasts in light of tariffs

– Darcy Keith

BMO Capital Markets has revised its economic forecasts in light of the tariffs going ahead. These are the highlights:

It sees tariffs reducing real GDP growth by roughly 1.5 percentage points to around 0.5 per cent in 2025.
CPI inflation is expected to rise less than one percentage point this year from the current 1.9 per cent rate in January. It sees the unemployment rate moving up to 8 per cent. (It was 6.6 per cent in January).
The housing market recovery could be dampened this year before resuming in 2026 on lower mortgage rates.
It predicts the Bank of Canada will cut rates by a quarter point in each of the next four meetings until July, taking its overnight rate to 2 per cent. Previously, BMO expected only two more rate cuts, in April and July.
With the Fed expected to stay on the sidelines at least until September in terms of its key interest rate, the Canadian dollar is set for further weakness, as Canada-U.S. spreads widen even further. BMO thinks the loonie will average around 67.1 cents US by this fall, with risks that it could happen sooner.

10:20 a.m.

Quebec, Canada, Mexico, Europe must work together on trade response: Bloc Québécois Leader

– Bill Curry

Bloc Quebecois leader Yves-François Blanchet speaks during the Face-a-Face 2021 debate at TVA studios in Montreal, Quebec on September 2, 2021.MARTIN CHEVALIER/AFP/Getty Images

Bloc Québécois Leader Yves-François Blanchet said Quebec, Canada, Mexico and Europe must work together on a common trade and security response.

“Their former ally is becoming an economic predator and is allying itself with a military predator,” said Mr. Blanchet in a post on X on Tuesday morning. “Quebec’s agriculture, aluminum, wood and culture are on the front lines. Someone will have to protect them.”

His comment followed an earlier statement released Monday evening, in which he said those who stand up to the United States “with intelligence and courage” will win.

He also predicted that Mr. Trump’s tactics will come back to haunt him.

“Americans will suffer inflation, isolation, distrust and lies,” he said.

10:18 a.m.

RBC CEO Dave McKay says tariffs are already slowing business activity

– Stefanie Marotta

Royal Bank of Canada chief executive officer Dave McKay says tariffs are already slowing business activity, but the severity of the hit will depend on the extent and duration of the trade war moving forward.

“It’s a little frustrating to see the loss of momentum that we have today,” Mr. McKay said at a conference Tuesday morning. “We have to deal with it. We still hope for the best outcome that these tariffs are short lived and we get back on to a growth agenda on all sides of the border that we were on before.”

In February, the bank posted higher first-quarter profit, beating analyst expectations as consumers and businesses benefited from lower interest rates. The bank set aside more provisions for potential loan defaults, but the increase was largely due to one large account with a utilities client.

Since the quarter ended on Jan. 31, the U.S. tariff threats have boosted uncertainty for consumers and businesses, Mr. McKay said.

“That negative narrative and the volatility around that narrative from January to today and to last night has had an immediate impact on the psychology of consumers, psychology of small businesses and the psychology of large corporates,” Mr. McKay said.

10:15 a.m.

Doug Ford appears on CNN, saying Canadians are ‘absolutely livid’ about tariffs

– Jeff Gray

Ontario Premier Doug Ford appeared on CNN Tuesday morning, saying Canadians were “absolutely livid” about the tariffs. He said the move would paralyze the U.S. auto sector, cause job losses, spark inflation and crash markets south of the border – while also forcing Canada to retaliate.

“This is unnecessary. And we do have to retaliate. And I apologize to the American people. It’s not you. It’s your President that’s causing this problem,” Mr. Ford said.

He pointed to his plan to remove U.S. booze from provincial liquor stores and bar U.S. companies from $30-billion in Ontario government procurement, and urged Americans to call their political representatives “to stop this insanity.”

Meanwhile, Grace Lee, a spokesperson for Mr. Ford’s office, says the premiers and the Prime Minister will hold a virtual first ministers’ meeting at 2 p.m. on Tuesday.

Mr. Ford is also due to address reporters in Toronto at 11:30 a.m.

10:12 a.m.

President of the Business Council of Canada reacts to Trump tariffs

– Robert Fife

Goldy Hyder, president of the Business Council of Canada, expressed disappointment that President Trump, who renegotiated the North American Free Trade Agreement in 2018, did not to seek trade changes at the negotiating table rather than hit Canada and Mexico with punitive tariffs.

“Regrettably, the decision to impose tariffs on Canada violates that same agreement and now forces Canada to take retaliatory measures. These measures should be strategic in scope and scale so as not to compound the harm of higher costs on Canadian families,” he said. “We must stand firm.”

Canadian Chamber of Commerce president Candace Laing called the tariffs a reckless decision that will push Canada and the U.S. into a recession.

“The U.S. government’s self-defeating tariff policy disregards decades of success and trillions in trade to try and revive a failed economic model from the 1800s. Tariffs are a tax on the American people,” she said. “The U.S. can claim this policy is about hitting Canada where it hurts, but it will soon see the disastrous impacts at home in cities like Detroit, Pittsburgh and Louisville.”

Ms. Laing said it’s now time for Canada to double down on protecting its economic sovereignty and security by taking steps to tear down all interprovincial trade barriers and diversify trade while revamping the tax and regulatory systems.

10:10 a.m.

Trudeau to speak about Canada’s response to tariffs

– The Canadian Press

Prime Minister Justin Trudeau arrives on Parliament Hill on Tuesday, March 4, 2025.Justin Tang/The Globe and Mail

Prime Minister Justin Trudeau is scheduled to talk more about Canada’s response, which will include tariffs on $155 billion worth of American goods, at 10:30 a.m. in Ottawa.

10:09 a.m.

Why is the market relatively calm?

– Darcy Keith

Traders work on the floor of the New York Stock Exchange (NYSE) in the Financial District in New York City on March 4, 2025.TIMOTHY A. CLARY/AFP/Getty Images

While stock markets are down and the Canadian dollar initially fell on the tariffs announcement late Monday, the reaction overall has been orderly and not as thunderous as some may have expected. After all, the U.S. tariffs are widely expected to throw the Canadian economy into a recession while raising inflationary risks in the U.S. economy. So why is Mr. Market so calm?

Derek Holt, vice-President and Head of Capital Markets Economics at Scotiabank, has helpfully provided a list of five possible reasons.

“One reason is that some of this was being priced in advance. Still, the cumulative effect on markets if tariff macro scenarios really were to unfold is small thus far.

“Another reason is because what we don’t know is duration and that’s key. Trump is a showboater and self-promoter with zero scruples and so for all we know he put these tariffs on just in order to be able to point to them in his speech tonight but they may not last. …

“Another reason the response may be limited is that the retaliatory responses fall shy of what the U.S. enacted – so far. China responded with another 15-per-cent tariffs on U.S. chicken, wheat, corn and cotton products and another 10-per-cent on sorghum, soybeans, pork, beef, seafood, fruits, vegetables and dairy products. These tariffs go in on March 10. The implied point is that China is signalling ongoing willingness to negotiate …

“And another reason is that stimulus announcements are likely to be forthcoming. The Bank of Canada is likely to cut next week as tariffs tip the balance in that direction, but expect a very measured bias given the potential effect of tariffs on supply chains and inflation. Canada also has full power through agencies like the EDC and BDC to announce targeted measures of support. Provinces are fully able to announce any supports. Federal measures require Parliament to pass but can be announced with the situation being fluid into elections.

“Finally, there is a bidirectional force built into the market response. Tariffs are bad for risk appetite, but some believe that souring risk appetite may provoke a pivot on trade policy by the Trump administration. If so, then the market response would price tariffs but also de-escalation. If that doesn’t happen, then markets are very vulnerable.”

9:59 a.m.

Canadian union leaders come out strongly against Trump tariffs

– Robert Fife

Canadian union leaders came out strongly against the Trump tariffs and urged Ottawa to stand up to the American President.

“After months of taunts and threats that have already hurt investment decisions and jobs in Canada, Trump has fired the first shot in a full-on trade war and now every Canadian politician, business leader, worker and resident must fight back,” said Unifor National President Lana Payne.

“Trump has seriously misjudged the resolve and unity of Canadians, and he has misjudged how damaging this trade war will be for American workers.”

Ms. Payne said the tariffs will hurt working people with higher prices for everyday goods, destroy jobs on both sides of the border and have devastating consequences for highly integrated manufacturing sectors, including auto, across Canada and the U.S..

“Today our trade relationship forever changed with the U.S. and now we must invest in ourselves, redefine international trade relationships, and build a new, more resilient economy,” she said.

United Steelworkers union (USW) national director for Canada Marty Warren called the President’s actions reckless and unjustified and an economic attack on workers in both countries.

“This is an all-out attack on Canadian workers, their families and the industries that keep our economy running,” said Mr. Warren. “Trump is imposing tariffs that have nothing to do with fair trade or the best interests of workers in the United States either. This reckless decision threatens jobs, risks devastating the Canadian communities that rely on them and will disrupt the supply chains on which North America depends.”

USW international president David McCall echoed Mr. Warren’s frustration, emphasizing the deep ties that unite American and Canadian workers.

“Canadian and American workers are not in competition – we build goods together,” Mr. McCall said. “These tariffs will hurt manufacturing, drive up costs and kill jobs on both sides of the border. “

The USW called on the Canadian government to take immediate action to impose retaliatory tariffs. The union also urged Ottawa to strengthen its procurement policies, and provide direct support to affected workers by expanding the Work-Sharing Program, enhancing Employment Insurance, setting up a wage subsidy program and investing in domestic industries to protect well-paid, community-supporting jobs.

“This isn’t just about steel or aluminum, like it was in 2018. Trump is now going after every sector of the Canadian economy,” Mr. Warren said. “Lumber, energy, manufacturing – you name it. He’s trying to crush Canadian workers and force our government into submission. Well, we won’t be intimidated.”

9:54 a.m.

Some U.S. auto workers worry trade war will affect jobs, others back tariffs

– Jason Kirby

Ford Motor Company’s electric F-150 Lightning on the production line at their Rouge Electric Vehicle Center in Dearborn, Michigan on September 8, 2022.JEFF KOWALSKY/Getty Images

At the sprawling Ford Motor Co. Rouge Complex in Dearborn, Mich., some U.S. auto workers said on Tuesday that they’re worried about what the trade war could mean for their jobs, while others backed the tariffs.

“I’m nervous because at the end of the day it’s going to be the people who are going to pay with higher prices,” said Kaled Abdulla, who has worked on the assembly line for three and a half years.

He also said he doubts the Trump administration’s claim that the tariffs will result in a manufacturing boom.

Rather than “spending billions to build new factories,” Mr. Abdulla said he thinks companies will choose to pay the tariffs, cut their costs and wait out Mr. Trump’s four-year term.

“I get that the long-term goal is to make the economy better, but we know we’re not making a tonne of money, so I’m scared for my job,” said Mr. Abdulla, who has two children and a third on the way.

“Do we really think Trump and Elon Musk and all these other billionaires are sitting around in a room asking themselves, ‘How can we help the average American citizen?’ ”

Rebecka Dobbyn, who voted for Mr. Trump in the last election and has worked at the Dearborn plant for eight years, said she was unaware that Canada-Mexico tariffs had taken effect but “it’s all part of his strategy to bring jobs back to America and help Americans.”

Although, she added, “It would be nice to be able to afford to buy eggs.”

Of 20 workers surveyed at the plant gate on Tuesday morning, only three were aware the tariffs are now in place.

“I’m sure it’s going to affect me, but I don’t really know how. I’ll have to do some research,” said Richard Malone, who has worked at the plant for one and a half years.

9:51 a.m.

Canadian Federation of Independent Business calls on Ottawa to immediately recall Parliament

– Laura Stone

The Canadian Federation of Independent Business in a statement called on the federal government to immediately recall Parliament “to ensure that Canadian businesses have the support they need and that every dollar Canada collects in tariffs is returned to affected businesses as quickly as possible.”

The organization, which represents 100,000 small and medium-sized businesses, also said Ottawa should “send a clear message that Canada is open for business and investment” by stopping the April 1 carbon tax increase, passing legislation to make sure carbon tax rebates are tax-free and passing proposed legislation to increase the lifetime capital gains exemption threshold to $1.25-million. “Political and policy uncertainty is the last thing the country needs at this moment,” said president Dan Kelly.

9:30 a.m.

At the open: TSX falls more than 1% as global market struggle to react to tariff uncertainty

– Reuters

Canada’s main stock index opened lower on Tuesday as President Donald Trump’s new tariffs on the top three U.S. trading partners took effect, triggering a global trade war.

At 9:31 a.m. ET, the Toronto Stock Exchange’s S&P/TSX composite index was down 1.3 per cent at 24,678.06.

Meanwhile, in the U.S., the CBOE market volatility index edged up 0.19 points after hitting a two-month high at 24.31 in the previous session.

The benchmark S&P 500 logged its biggest one-day drop since mid-December and the Nasdaq closed lower by about 9 per cent from its all-time high on Monday.

European stocks fell 1.3 per cent, losing ground from their record highs, with tariff-sensitive automakers losing 4.3% and on track for their worst day since September 2022.

9:18 a.m.

Mexico will impose retaliatory tariffs on U.S. goods

– The Associated Press

Mexico’s President Claudia Sheinbaum holds a press conference a day before the imposition of tariffs by U.S. President Donald Trump, at the National Palace in Mexico City on March 3, 2025.Luis Cortes/Reuters

Mexico President Claudia Sheinbaum said Tuesday that Mexico will respond to 25-per-cent tariffs imposed by the United States with its own retaliatory tariffs on U.S. goods.

Sheinbaum said she will announce the products Mexico will target on Sunday in a public event in Mexico City’s central plaza, perhaps indicating Mexico still hopes to de-escalate the trade war set off by U.S. President Donald Trump.

Unlike China, which imposed retaliatory tariffs immediately, Mexico decided to wait until Sunday, though the country has said since January that it had a plan ready for precisely this scenario.

“There is no motive or reason, nor justification that supports this decision that will affect our people and our nations,” she said.

9:11 a.m.

China tariffs come as country’s leaders meet in Beijing

– James Griffiths

Chinese President Xi Jinping reads a document during speeches at the opening session of the CPPCC at the Great Hall of the People on March 4, 2025 in Beijing, China.Kevin Frayer/Getty Images

An escalation in the U.S.-China trade war, sparked by new U.S. tariffs targeting all Chinese imports, comes as top Chinese leaders and policymakers are gathering in Beijing for an annual meeting of the country’s rubber-stamp parliament, the National People’s Congress.

While more of a forum for policy announcements rather than formulation, the NPC, and the concurrent meeting of the Chinese People’s Political Consultative Conference, is closely watched by observers for signals about potential economic policy changes.

Even before U.S. President Donald Trump restarted a trade war with Beijing, the Chinese economy had been struggling, weighed down by a lacklustre recovery from the COVID pandemic, structural issues around debt and housing supply, and a looming demographic crisis.

“China faces serious socio-economic challenges at home, and recent global developments have added to the political uncertainty,” Nis Grünberg, lead analyst at the Berlin-based Mercator Institute for China Studies, said last week.

The NPC meeting will be used, Mr. Grünberg predicted, “to show political unity, steady progress and messages underscoring that China is on the right track to greatness under the leadership of Xi Jinping.”

Beijing has responded by imposing 10-15 per cent levies against U.S. agricultural and foodstuffs.

9:01 a.m.

How markets are reacting to Trump’s tariffs so far

– Darcy Keith

There’s a lot of red in markets this morning, yet so far little appearance of panic selling in equities.

The Canadian dollar is actually making a bit of a comeback after falling sharply late Monday when U.S. President Donald Trump confirmed tariffs were coming Tuesday. The Canadian dollar is up about half a cent from its lows on Monday and is now trading at 69.25 cents US.

Part of that reflects weakness in the U.S. dollar against major currencies Tuesday morning, as forex traders become increasingly convinced that the U.S. economy was slowing even ahead of the tariff implementation and is now set for even more damage. Several economic readings, from consumer confidence to inflation expectations to factory orders, have been weaker than expected in recent days.

Bond yields are a little lower in both Canada and the U.S. Tuesday morning, and credit markets are showing a realignment of where traders foresee the monetary policy impact. Overnight swaps markets, which capture traders’ bets of where interest rates are heading, now suggest 82-per-cent odds that the Bank of Canada will cut rates by a quarter per cent at its next policy meeting on March 12 to combat the dampening effects tariffs will have on the economy. Prior to Mr. Trump’s statement on tariffs Monday, those odds were only at 50 per cent. Money markets are now fully pricing in 75 basis points of rate cuts over the course of this year.

TSX futures are down about 1 per cent after suffering the worst session of the year on Monday. Stocks that are involved in a lot of two-way trade, such as Bombardier, will be particularly interesting to watch today. But calmer heads seem to be prevailing so far. Ford and General Motors, which have vast supply chains across North America, were steady in premarket trading after sharp declines in the previous session.

8:50 a.m.

Trump’s speech to Congress will represent ‘renewal of the American dream’: White House press secretary

– Laura Stone

Speaking on Fox & Friends Tuesday morning, White House press secretary Karoline Leavitt said the theme of Mr. Trump’s speech to Congress Tuesday night is the “renewal of the American dream” and that he plans to fix the “economic mess” left by the Biden administration. She said the President will ask Congress for more border funding to “continue with these deportations that have been incredibly successful.”

On the decision to pause aid to Ukraine, Ms. Leavitt said Mr. Trump “wants to make a deal” and that Ukrainian President Volodymyr Zelensky is unwilling to talk about a real peace agreement, adding “we’ll have to see” if Mr. Zelensky would sign a critical minerals deal with the U.S. now.

Mr. Trump’s speech will last about an hour, she said, but “it could always go a little bit longer.”

8:45 a.m.

Businesses in Buffalo, N.Y. brace for tariff impact, prepare to lose Canadian customers

– Greg Mercer

Executive Chef Ken Legnon at Johnny D’s restaurant in Downtown Buffalo.Sammy Kogan/The Globe and Mail

In Buffalo, which depends on Canada for so much of its economic activity, restaurateurs are concerned that a trade war could affect many aspects of their business, from food costs to reservations. They say the chaotic messaging from Washington over tariffs has a lot of people in this former Rust Belt city worried that Canadians are already choosing to stay home.

“It’s an enormous piece of our business. We get a lot of business from Toronto, we get a lot of Canadian guests. So I’m very concerned,” Chris Harter, the owner of Johnny D’s restaurant in Buffalo, said.

In 2024, Canadian visitors spent nearly US$933-million in the Buffalo Niagara region, including US$398-million on retail, according to tourism-research company Longwoods International. Many in Buffalo, a blue-collar city rebounding from decades of decline in its auto-parts and steelmaking industries, are worried that a buy-Canadian and U.S. boycott movement could hurt their region just as things are improving economically.

The Peace Bridge that connects Buffalo to Ontario is one of the busiest border crossings in North America, carrying more than four million vehicles each year. Buffalo has been enjoying a tourism boom in recent years, with tens of thousands of Canadians driving here for youth hockey tournaments, to tailgate at Buffalo Bills football games or watch the Toronto Blue Jays’ minor-league baseball affiliate. They come to shop at Target, for concerts and musicals at Shea’s Buffalo Theatre and the Buffalo AKG Art Museum.

U.S. political leaders and economists in Western New York warn that a trade war would have consequences far beyond tourism – including for the region’s manufacturing, trucking and brewing sectors, which are deeply integrated with suppliers on the Canadian side.

8:33 a.m.

London research firm says Canada will ‘undoubtedly’ fall into recession if the U.S. tariffs remain in place

– Eric Reguly

Capital Economics, a London research firm, said in a note published Tuesday that Canada will “undoubtedly” fall into recession this year if the U.S. tariffs that came into effect this morning remain in place for some time.

Capital said sustained 25-per-cent across-the-board tariffs would hit Canadian GDP by about 3 per cent in the first year. The Bank of Canada made a broadly similar prediction in January in its Monetary Policy Report.

The question is how long U.S. tariffs will last and whether the White House will reduce them fairly fast or increase them. Capital raised the possibility of the latter scenario, which would deepen a recession. “The Executive Orders signed by Trump stipulate that the administration will hike tariffs further in response to retaliatory tariffs, risking an even larger hit to Canadian GDP,” Paul Ashworth, Capital’s chief North American economist, said in the note.

Canada has already announced retaliatory tariffs on $155-billion worth of imports from the United States. Those tariffs will push up inflation rates in Canada. Another factor that will push up inflation is the 7-per-cent fall in the loonie over the past six months, making imports more expensive. “In the downside scenario, retaliatory tariffs initially push inflation up sharply to a peak of 3.5 per cent, but inflation is lower by the end of 2026 amid much weaker demand,” Mr. Ashworth said.

The only good news is that the relatively small U.S. tariffs on Canadian energy are unlikely to do much damage to the Alberta oil industry. “The smaller 10 per cent tariff on energy products does not change our assessment, as oil exports were likely to be inelastic anyway because many U.S. refineries are set up to process Canada’s heavy crude,” Mr. Ashworth said.

7:55 a.m.

Nova Scotia to block American companies from bidding on provincial contracts, Premier Tim Houston says

– The Canadian Press

Nova Scotia Premier Tim Houston says in a social media post that his province will block American companies from bidding on provincial contracts.

Mr. Houston adds that Nova Scotia is “actively seeking” options to cancel existing contracts until Trump removes the tariffs.

Other measures being enacted in Nova Scotia include removing American liquor from provincially run stores, working to remove interprovincial trade barriers and further developing natural resources.

Mr. Houston says Trump is a “short-sighted man” who is wielding power without consideration for the “destructive impact” his decisions have on Canadians and Americans.

7:48 a.m.

Tariffs will have ‘immediate’ negative consequences on North America’s vehicle supply chain, CVMA president says

– The Canadian Press

An employee works on the production line at the Martinrea auto parts manufacturing plant, which supplies auto parts to Canada and U.S. plants, in Woodbridge, Ont., on Feb. 3.Chris Young/The Associated Press

Brian Kingston, president and CEO of the Canadian Vehicle Manufacturers’ Association, says the tariffs will have “immediate” negative consequences on the North American vehicle supply chain.

Mr. Kingston said in a statement to media that the tariffs will reduce vehicle production, increase sale prices and lead to manufacturing job losses across the continent. Mr. Kingston says that “every effort” should be taken to remove tariffs as soon as possible.

The auto manufacturing sector contributes more than $18-billion to Canada’s GDP, according to the association.

7:43 a.m.

Trump’s tariffs dominating news in Washington

– Laura Stone

Laura Stone

Good morning from Washington, where President Donald Trump’s tariffs are dominating the news here. (Well, that and some other stuff …) Mr. Trump is set to address Congress Tuesday evening and is expected to expand on his tariff plan as part of his vision for America. For now, we wait and see what else the day brings.

U.S. President Donald Trump’s new 25 per cent tariffs on imports from Mexico and Canada took effect on March 4, along with a doubling of duties on Chinese goods to 20 per cent, launching new trade conflicts with the top three U.S. trading partners.

Reuters

7:35 a.m.

Americans are waking up to the fallout from Trump’s tariffs

– Mark Rendell

A commercial truck drives toward the Ambassador Bridge to Windsor, Ont., from Detroit on March 3.Rebecca Cook/Reuters

American companies, consumers and investors are finally getting nervous.

Mr. Trump’s threat to blow up decades of continental economic integration was initially met by a shrug from U.S. investors and businesses, who seem to have doubted his willingness to follow through or focused on the potential benefits of lower corporate taxes and deregulation promised by the new administration. But this optimism has faded as the President has barrelled toward a trade war.

“I think people expected that deregulation and tax policy would be concurrent with tariffs, but really tariffs are dominating now and everybody’s recognizing that this is what’s going to hit us first, and that’s going to hit our bottom line,” Ali Jaffery, senior economist at Canadian Imperial Bank of Commerce, said in an interview.

After surging in the wake of Mr. Trump’s election, the big U.S. stock indexes have largely fallen back to where they were in early November. Some economic indicators are starting to turn south, although others show that the U.S. economy remains strong.

The latest warning sign came from the monthly ISM Manufacturing Index report, published Monday, which captures U.S. manufacturing activity and the outlook for the sector. The ISM index declined slightly in February while the survey captured a shift in mood.

“Prices growth accelerated due to tariffs, causing new order placement backlogs, supplier delivery stoppages and manufacturing inventory impacts. Although tariffs do not go into force until mid-March, spot commodity prices have already risen about 20 per cent,” Timothy Fiore, chair of the ISM manufacturing business survey committee, said in a news release.

7:10 a.m.

Ford threatens to shut off Ontario’s electricity exports

– Jeff Gray

Ontario Premier Doug Ford turns to government ministers after speaking at the Prospectors, Developers, Association of Canada conference, in Toronto, on Monday March 3, 2025.Chris Young/The Canadian Press

Ontario Premier Doug Ford took to a U.S. TV network on Monday to warn that Americans as well as Canadians would face economic harm from the 25-per-cent tariffs.

Speaking to NBC’s Meet the Press Now on Monday afternoon, Mr. Ford threatened to shut off his province’s electricity exports to the U.S. and to block shipments of Ontario’s high-grade nickel, which he said provides 50 per cent of U.S. supplies. He warned it would “shut down manufacturing” south of the border.

Michigan’s auto plants, unable to afford Canadian parts, would grind to a halt within a week, he said, while prices for U.S consumers would rise, and markets would crash.

“We do not want to do this,” Mr. Ford said. “We love the American people. We love the U.S. But when one person attacks our country, unprovoked, then we’re going to respond. And we’re going to respond like the U.S. has never seen before.”

Mr. Ford also suggested that Saskatchewan’s potash, crucial for American farmers to fertilize their fields, as well as its uranium, could be used as trade retaliation – even though Premier Scott Moe and Alberta Premier Danielle Smith have spoken out against using their provinces’ natural resources in a trade war.

In British Columbia, which tables its budget Tuesday, the province’s Finance Minister said the fiscal plan would meet the moment without deep cuts to spending.

Other provinces in recent weeks have unveiled budgets that include contingency funds and financial relief for taxpayers, as premiers work to gird against knock-on effects that remain hard to quantify.

6:40 a.m.

Tariffs rattle Canadian and Mexican currencies

– Reuters

The Canadian dollar and Mexican peso fell to one-month lows after U.S. President Donald Trump levied steep tariffs on the countries.Mark Blinch/Reuters

The Canadian dollar and Mexican peso fell to one-month lows after U.S. President Donald Trump levied steep tariffs on the countries, although a fall in the U.S. dollar on the back of weak economic data limited the broader impact on Tuesday.

Market moves were fairly muted in the immediate aftermath of the tit-for-tat tariff actions, although worries of a wide-ranging trade war hit stocks hard on Monday.

The Canadian dollar was around 0.3% stronger at 1.4438 per U.S. dollar, having hit a one-month low of 1.4542 late on Monday.

The Mexican peso was last down roughly 0.9% at 20.89 per dollar, its lowest since February 3.

Analysts said many in the market were hoping tariffs might quickly be lifted if deals can be struck, much as the initial threat of levies against Canada and Mexico was halted in February.

Although tariffs might be expected to boost the U.S. dollar, recent weak economic data has weighed on the currency and bond yields in the United States.

The U.S. dollar index, which tracks the currency against six peers, was last down 0.22 per cent at 106.3, around its lowest in three months.

5:40 a.m.

Premarket: Global stocks, bond yields slide as U.S. tariffs ignite new trade battle

– Reuters

Stocks and bond yields slid on Tuesday as investors globally ducked for cover after the United States hit Canada, Mexico and China with steep tariffs.

European stocks slid 1 per cent, falling back from record highs, with shares of automakers, vulnerable to trade duties, losing 3 per cent. Aerospace and defense stocks hit a record high, however.

Government bond yields fell. U.S. 10-year Treasury yields dropped to their lowest since October at 4.115 per cent, while yields on German 10-year bonds, a benchmark for the euro zone, also slid.

Other riskier assets lost ground too, with bitcoin slipping under $84,000, erasing a surge at the start of the week. The risk-sensitive Australian dollar fell, too.

MSCI world equity index, which tracks shares in 47 countries, fell 0.2 per cent.

Still, U.S. futures gained almost 0.3 per cent, signaling the sell-off may peter out globally. The S&P 500 is down about 5 per cent from its February 19 all-time closing high as tariffs exacerbate concerns about growth.

Investors were also unnerved by U.S. President Donald Trump pausing military aid to Ukraine following his clash with Ukrainian President Volodymyr Zelensky last week, deepening the fissure that has opened between the one-time allies.

5:37 a.m.

European stocks slump as Trump tariffs kick in

– Eric Reguly

European markets lost ground on Tuesday morning after soaring the day before, when defence companies rallied in London, Paris, Frankfurt and Milan on the prospect of Europe stepping up the transfer of weapons to Ukraine to fill the hole left by the United States.

Spooked by the global trade war unleashed by U.S. President Donald Trump, and the possibility that Europe too could soon face a barrage of punishing American tariffs, the main European stock indices sank from their record highs set on Monday.

Germany’s DAX index was the worst hit by late morning, European time, with a fall of almost 2 per cent. London’s FTSE-100 fared somewhat better, with a loss of just under 0.5 per cent. France’s CAC 40 lost 1.2 per cent.

Among the biggest losers were the car companies, whose North American operations could be damaged by the 25 per cent tariffs on Canada and Mexico that began early Tuesday. Stellantis, BMW, Mercedes, Renault, Porsche and Volkswagen were all down by between 2 per cent and 6 per cent.

Oil prices also went into reverse, with Brent Crude, the international benchmark, down 1.3 per cent in London trading. The downturn in prices – Brent is down 15 per cent in the past 12 months – came after the OPEC-Plus group of producers, which includes Russia, signaled plans to boost supply. Oil investors also feared that the global trade war could reduce economic growth everywhere, pushing down energy demand.

Bond yields also fell across Europe as prices rose (yields and prices move in opposite directions) as investors sought the relative security of government-issued debt.

Some stocks defied the slump. Leonardo of Italy, one of the world’s biggest defence contractors, rose 1.4 per cent on the Milan bourse after having climbed 17 per cent on Monday, taking its one-year return to almost 125 per cent. The defence companies’ rally came after the White House on Monday announced a pause in U.S. weapons sales to Ukraine, which should translate into extra orders for European suppliers of everything from missiles to artillery shells.

3:07 a.m.

China hits back with measures targeting agricultural products

– James Griffiths

Ships and containers are shrouded in fog at the Yangshan Deepwater Port in Shanghai on Feb. 16, 2025.-/AFP/Getty Images

Minutes after new U.S. tariffs came into force against a slate of Chinese goods Tuesday, Beijing responded by imposing 10-15 per cent levies against U.S. agricultural and foodstuffs.

Additional 15 per cent tariffs will be imposed on U.S. chicken, wheat, corn and cotton imported into China, while sorghum, soybean, pork, beef, and other foodstuffs will be subject to a 10 per cent tariff, China’s State Council said in a statement.

Speaking to reporters, Chinese Foreign Ministry spokesperson Lin Jian said Beijing “will play along to the end” if Washington is intent on waging a trade war.

In addition to the new tariffs announced Tuesday, China also placed 25 U.S. firms under export and investment restrictions on national security grounds.

The measures were in response to a new 10 per cent tariff on all Chinese goods imposed by President Donald Trump late Monday, on top of existing across-the-board 10 per cent tariffs his administration has enacted against China since coming to power in January.

12:01 a.m.

U.S. triggers trade war with tariffs on Canada, Mexico

– Kate Helmore and Pippa Norman

From left, U.S. President Donald Trump, Canadian Prime Minister Justin Trudeau, China’s President Xi Jinping, and Mexico’s President Claudia Sheinbaum.The Associated Press

U.S. President Donald Trump launched a trade war with Canada at 12:01 a.m. Tuesday morning, citing a threat to national security posed by “unchecked drug trafficking.”

The U.S. is now imposing 25 per cent tariffs on Canadian goods, with a 10 per cent tariff on energy and critical minerals.

Prime Minister Justin Trudeau has vowed to retaliate, hitting back with $30-billion in tariffs on U.S. goods, rising to $155-billion in 21 days. These measures took effect at the same time as the U.S. tariffs.

Early Tuesday morning, trucks lined up on either side of the Ambassador Bridge, the main artery between Windsor, Ont., and Detroit. It is the busiest international crossing in North America. Every day, about $329-million worth of products cross the Detroit River, from vegetables to automotive parts. It handles about one third of all trade between the two countries.

The next 24 hours promises to be confusing and chaotic for this border crossing and those living on either side.

The move from Mr. Trump upends the free trade that has benefited both Canada’s largest industries and its everyday consumers.

President Donald Trump said on Monday that there was no chance for Canada or Mexico to prevent 25 per cent tariffs from taking effect on Tuesday, sending financial markets reeling on the prospect of new economic barriers.

Reuters

March 3, 10:15 p.m.

Trudeau announces counter tariffs

– Laura Stone and Steven Chase

Prime Minister Justin Trudeau speaks during a news conference Feb. 1, 2025 on Parliament Hill in Ottawa.DAVE CHAN/AFP/Getty Images

The announcement, after months of economic threats from Mr. Trump, prompted a response from Mr. Trudeau hours later. He said in a statement Monday evening that Canada would retaliate with its own tariffs on billions of dollars in American goods, setting the stage for a major trade war between this country and its largest trading partner.

The retaliatory tariffs, Mr. Trudeau said, would take effect at 12:01 a.m. ET on Tuesday morning if the U.S. tariffs were in effect. He defended Canada’s actions on the border and its work to stem the flow of fentanyl into the U.S.

“Let me be unequivocally clear – there is no justification for these actions,” he said, referring to the U.S. tariffs.

Mr. Trudeau is expected to address Canadians Tuesday morning to detail the retaliatory measures. His statement says they will initially apply to $30-billion in U.S. goods, rising to $155-billion in 21 days.

March 3, 3:00 p.m.

Trump says no room left for a deal, U.S. will impose 25% tariffs on Canadian and Mexican goods

– Laura Stone and Steven Chase

U.S. President Donald Trump is shown signing an executive order in the Oval Office at the White House on Feb. 25, 2025 in Washington, DC.Alex Wong/Getty Images

U.S. President Donald Trump says his government will impose 25-per-cent tariffs on Canadian and Mexican goods starting Tuesday, saying there is no room left for either country to make a deal to avoid the punishing levies.

Speaking to reporters at the White House Monday, Mr. Trump confirmed the 25-per-cent tariffs will go ahead as planned beginning Tuesday, adding the countries will need to build car plants and other items in America in order to relieve the levies.

The President also said reciprocal tariffs will take effect on April 2.