Canada, Mexico announce retaliatory tariffs on US imports in response to Trump's tariffs on American neighbors

Published On Feb 2, 2025, 12:57 AM

Canada and Mexico have announced retaliatory tariffs on U.S. goods in response to President Trump's tariffs which had imposed a 25% tax on imports from these countries. Canada's tariffs will affect about $155 billion in U.S. imports including alcohol and fruit, with Prime Minister Trudeau warning of economic pain as a result. Mexican President Claudia Sheinbaum has also implemented tariffs and criticized U.S. claims about issues regarding illegal drugs and crime. This move is expected to exacerbate inflation and hurt the U.S. economy, contrary to Trump’s promises to lower consumer prices.

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Stock Forecasts

AI prediction results, not representative of any investment advice.

XLY

Negative

The imposition of tariffs is likely to escalate trade tensions and could lead to increased prices for consumers in the U.S., leading to reduced consumer spending. This environment might negatively impact sectors heavily reliant on imports or exports to these countries, especially retail, consumer goods, and automotive industries.

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XLI

Negative

With Canadian and Mexican governments imposing tariffs, U.S. companies facing higher import costs may see their revenue growth hindered. Sectors such as manufacturing, which heavily rely on imported materials from Canada and Mexico, might particularly suffer.

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