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Trade Tensions Escalate Between US and Canada
US President Donald Trump has threatened to impose a steep 50% tariff on all aircraft imports from Canada, accusing Ottawa of unfairly blocking certification of Gulfstream business jets. Trump said the decision to “decertify” Canadian-made aircraft will stand until Gulfstream, an American company, is fully certified.
Key Statements from the President
“Canada is effectively banning Gulfstream sales in Canada through its certification process.”
“If this is not immediately corrected, I will charge a 50% tariff on any and all Canadian aircraft sold into the US.”
Market Reaction
The USD/CAD pair fell 0.50% to 1.3489 following the announcement, reflecting market caution over escalating trade tensions.
Tariffs and Global Trade
Tariffs are customs duties placed on imported goods to protect domestic industries. While they can make local products more competitive, they often lead to higher costs for buyers and can spark trade disputes. The US-Canada aircraft disagreement highlights how tariffs can quickly become a flashpoint in broader economic and political relations.
Looking Ahead
Investors and traders will closely watch the situation, as any formal tariff imposition could impact aviation markets and broader US-Canada trade. Negotiations or policy adjustments in the coming days may determine whether tensions escalate further or ease.
