We got a classic Trump U-turn on trade to close out last week after Canada’s decision to keep the DST in place, with the first payment due Monday.

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Based on this egregious Tax, we are hereby terminating ALL discussions on Trade with Canada, effective immediately. We will let Canada know that Tariff that they will be paying to do business with the USA within the next seven day period.

Donald Trump - Truth Social post

His frustration makes sense, as the tax takes aim at the one place the U.S. maintains a large trade surplus with Canada…

… at a time when the Trump administration is trying to reduce the surplus we enjoy in the cross-border flow of goods.

The knee-jerk reaction in markets was a sell-off in the loonie, before investors took stock of what this tax really is: a bargaining chip, and a big one at that.

At 3% of Canadian revenues, the retroactive charge carries a $2B price tag for the most influential set of companies on U.S. Congress. Let’s see how it develops.

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