President Trump’s increased tariffs on steel and aluminum imports went into effect, aiming to reorder global trade norms in favor of the U.S. This move brought back global tariffs of 25% on all metal imports, including downstream products. The potential for a U.S.-Canada trade war escalated when Trump threatened to double tariffs on Canadian steel and aluminum. However, this was avoided after Ontario Premier Doug Ford agreed to suspend a surcharge on electricity exports to the U.S. pending a discussion on revising the U.S.-Mexico-Canada Agreement on trade.
The U.S. Customs and Border Protection agency cut off imports qualifying for duty-free entry under quota arrangements, with the most affected countries being Canada, Brazil, Mexico, and South Korea. The U.S. steel industry welcomed the increased tariffs, stating they would help create new jobs and prevent unfair trade practices.
The escalation in trade tensions has sparked fears of a recession, with concerns raised by economists, investors, consumers, and businesses. Recent surveys have shown weakening sentiment and growing pessimism among small businesses and households. Trump’s focus on tariffs since taking office has raised concerns about the potential economic impact of his policies. Overall, Trump did not rule out the possibility of a recession due to his economic policies, such as tariffs, but remained optimistic that they would ultimately benefit the economy.
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