Trump reverses course on Canadian tariffs after market turmoil
“President Donald J. Trump for Time Magazine in 2019” by Pari Dukovic, inkjet print, June 17, 2019 (printed 2020). National Portrait Gallery, Smithsonian Institution. Copyright 2019 Pari Dukovic. President Donald J. Trump for Time Magazine in 2019
President Donald Trump abruptly reversed his decision to double tariffs on Canadian steel and aluminum to 50%, just hours after announcing the move.
The sudden shift, which rattled financial markets, came after Ontario Premier Doug Ford backed away from his own plan to impose a 25% surcharge on electricity supplied to over one million U.S. homes.
Ford’s initial retaliatory threat prompted the White House to reconsider, leading to a resolution where only the previously planned 25% tariffs on steel and aluminum from Canada and other nations would take effect at midnight on March 12.
White House spokesperson Kush Desai framed the outcome as a strategic victory, stating, “President Trump has once again used the leverage of the American economy… to deliver a win for the American people.”
The back-and-forth intensified market volatility, with the S&P 500 briefly plunging into correction territory after Trump’s initial tariff hike announcement. Stocks rebounded after Ford rescinded the surcharge and Ukraine agreed to a 30-day ceasefire.
Trump’s tariff threats also sent aluminum prices soaring, with premiums on the U.S. physical market surpassing $990 per metric ton, a record high.
Meanwhile, business leaders and economists expressed growing concerns that Trump’s aggressive trade policies could dampen consumer confidence and derail the U.S. economy’s “soft landing.”
A third straight month of declining small business sentiment underscored the uncertainty gripping markets amid the administration’s shifting trade strategies.
