Trump Threatens 35% Tariff on Some Canadian Goods

Tariffs Impact on Trade - A 35% tariff on Canada may not be as impactful as it seems due to USMCA exemptions for goods traded through the U S trade deal, including machinery, auto, and auto parts [1] - The 35% tariff is not significantly higher than the existing 25% level [2] - Tariff announcements have been moved back before, especially for Canada, as negotiations with the U S and Mexico regarding USMCA updates are ongoing, raising questions about whether the tariff will be implemented or used as a negotiating tactic [3] US Tariff Strategy - President Trump is questioning the assumption of a 10% baseline tariff [4] - Tariff letters sent to various economies indicate double-digit increases, aligning with previous observations [5] - Japan and South Korea are actively trying to lower tariff levels to avoid implementation before August 1st [6] - A 20% tariff level would effectively double the economic damage expected by markets and economists from President Trump [6] - President Trump monitors the markets and may adjust tariff levels based on market reactions [6][7] Economic Data and Future Outlook - Increased talks and negotiations are expected as the new deadline of August 1st approaches [8] - Economic data from Japan and China will highlight the risks to economies, including unemployment rate, inflation, labor market dynamics, and GDP [9] - Data is expected to show weak exports due to tariffs and uncertainty, potentially weakening investment in industrial production [10] - Companies across Asia are already experiencing price pressures due to tariff negotiations with the U S [11]