The move, affecting billions in consumer products like food, beverages, and textiles, follows a cabinet meeting and Carney’s recent phone call with President Donald Trump, their first in weeks. Tariffs will remain on U.S. steel, aluminum, and automobiles amid ongoing disputes. Officials described the decision as an “olive branch” to reset negotiations ahead of the 2026 USMCA review, responding to U.S. pressure and aiming to curb inflation. A White House official welcomed the step, signaling continued talks on trade and security. The Canadian dollar rose after the announcement, trading at C$1.3833 per U.S. dollar. This de-escalation comes amid a trade war sparked by U.S. tariffs imposed in March, targeting non-compliant goods at 35% since July. Analysts view it as positive for cross-border supply chains, though core issues persist.

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