Canada Concedes To Trump's Demands, Pauses Tariffs

This Monday, the Canadian government caved in to U.S. President Donald Trump's demands as a result of a steep 25% tariff.

Trump implemented this 25% tariff on Saturday along with a similar tariff rate on Mexico and a 10% tariff hike on the People's Republic of China. During his 2024 presidential campaign, he repeatedly promised these tariffs, so this is not very unexpected from him.

Trump threatened Canada especially to provoke changes to their northern neighbor's immigration policy and possibly ignite talks of it becoming the "51st state," although this is very unlikely. If Canada did not concede within the duration of the first tariff, the president would then double the tariff to 50%, surely causing a Canadian surrender at that point.

With Canada being one of America's largest trading partners, this tariff would've have held immense significance on the direction of both economies. However, Canada's would've been harmed much more, as it relies more on the U.S. than vice versa.

Thus, in a remarkable turn of events, Canadian Prime Minister Justin Trudeau conceded to Trump's demands in a mere few days, ending the de-facto trade war. He had a so-called "good" call with President Trump mere hours after Mexican President Claudia Sheinbaum conceded to Trump, and finally decided to enact measures at preventing the fentanyl trade across the northern border.

News of both the Mexican and Canadian surrenders to Trump caused markets to make up for much of their losses throughout midday, with markets only being marginally down.