Canada tariffs: Trudeau hits back against Trump with 25% levy
Published On Feb 2, 2025, 5:28 AM
Canada has introduced retaliatory tariffs of 25% on $155 billion worth of U.S. goods, including alcohol, household appliances, and sporting goods, in response to U.S. tariffs on Canadian imports. This action signifies the onset of a trade war between the two countries. Economists predict these tariffs will lead to higher prices on various consumer goods. The escalation of tariffs could also impact economic growth and inflation in both countries, with potential negative consequences for integrated trade relations.
Stock Forecasts
XLY
Negative
Given the imposition of tariffs and the potential for further escalation, consumer goods companies in affected sectors could see a rise in costs and reduced demand, leading to lower profits. Additionally, the overall economic impact might stifle growth, leading to broader market declines.
USO
Neutral
As trade tensions rise, U.S. oil companies may see mixed impacts from tariffs, with Canadian crude oil exports still being significant despite the lower tariff rate. However, any increase in tensions may lead to volatility in oil prices as market stability is challenged.
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