The US has signed executive orders imposing sweeping tariffs on its three largest trading partners – Canada, Mexico, and China. The move is expected to lead to higher prices for consumers, disrupt global trade, and raise inflationary pressures.
Under the new tariffs, 25% will be imposed on goods imported from Canada and Mexico, with some exceptions such as Canadian energy products. China’s goods will face a 10% tariff. These tariffs are set to take effect at 12:01am Eastern time on Tuesday.
The impact of these tariffs will vary by industry. The auto and electric equipment sectors in Mexico are most exposed, while mineral processing in Canada is also vulnerable. In the US, farming, fishing, metal, and auto production will be affected.
Consumers can expect higher prices for non-durable goods such as groceries, which could lead to a swift increase in prices within weeks of the tariffs taking effect. However, it may take longer for durable goods like cars to feel the pinch due to existing inventory levels.
Economists warn that if these tariffs are not lifted, they will lead to higher inflation and economic growth slowdown. The US government has claimed that the tariffs are necessary to combat illegal aliens and illicit drugs entering the country.
However, Canada and Mexico have signaled their intention to retaliate with tariffs of their own, including targeting orange juice from Florida, whiskey from Tennessee, and peanut butter from Kentucky.
Source: https://www.nytimes.com/2025/02/01/business/trump-tariffs-canada-mexico-china.html