As of July 4, 2025, Canada has imposed sweeping retaliatory tariffs on a range of U.S. goods in response to trade measures by Donald Trump’s administration. This report examines the background of the U.S.-Canada trade dispute, the economic fallout for both nations, market reactions (stocks and crypto), expert forecasts, and the overall outlook in a neutral, fact-driven manner.

1. Background and Context

Origins of the U.S.-Canada Trade Dispute:
Tensions in U.S.-Canada trade relations can be traced back to the early days of Donald Trump’s presidency. In 2018, the Trump administration imposed tariffs of 25% on imported steel and 10% on aluminum from several allies, including Canada, under a “national security” justification. Canada – a close defense partner of the U.S. – viewed this rationale as “insulting and unacceptable,” in Prime Minister Justin Trudeau’s words. In response, Ottawa retaliated in June 2018 with tariffs on C$16.6 billion (US$12.5 billion) worth of U.S. goods, targeting iconic American products like bourbon whiskey, ketchup, orange juice, and other items. “Canadians are polite, we’re reasonable, but we also will not be pushed around,” Trudeau famously said at the time, emphasizing that Canada would defend its interests (After a year of nice, Trump brings Trudeau to brink of trade war | Reuters). This firm stance set the tone for the trade relationship amid NAFTA renegotiations (which led to the USMCA free trade pact in 2020).

Trump’s Renewed Tariff Offensive in 2025:
After a period of relative calm following the USMCA, trade frictions re-emerged dramatically in early 2025. In February 2025, shortly after assuming office again, President Trump signed an order for “near-universal tariffs” on imports from Canada and Mexico, effectively placing a 25% duty on all Canadian exports to the U.S. (with a 10% tariff on Canadian oil and energy) (2025 United States trade war with Canada and Mexico - Wikipedia). These steep tariffs were scheduled to take effect on Feb 4, 2025, but were delayed by one month after last-minute negotiations. Trump tied these tariffs not only to trade grievances but also to non-trade issues – he stated the goal was to pressure Canada and Mexico to stop illegal immigration and the flow of fentanyl into the U.S., and to reduce the trade deficit (2025 United States trade war with Canada and Mexico - Wikipedia) (2025 United States trade war with Canada and Mexico - Wikipedia). Canadian officials adamantly rejected the notion that they posed a security threat or weren’t doing enough on those fronts, noting such claims violated the spirit of the USMCA agreement (2025 United States trade war with Canada and Mexico - Wikipedia).

Key Developments Leading up to Retaliation:
Despite talks during the reprieve, the U.S. tariffs ultimately took effect on March 4, 2025. President Trump declared there was “no room left” for further negotiation with Ottawa or Mexico City to avert the tariffs (2025 United States trade war with Canada and Mexico - Wikipedia). Canadian Prime Minister Justin Trudeau swiftly announced countermeasures. At 12:01 a.m. on March 4 (simultaneous with the U.S. duties), Canada implemented 25% retaliatory tariffs on an initial C$30 billion (US$20.6 billion) worth of American imports, with plans to expand the tariffs to cover C$155 billion (US$106 billion) of U.S. goods after a brief consultation period (Canada's plan for retaliatory tariffs on the US | Reuters) (2025 United States trade war with Canada and Mexico - Wikipedia). This value roughly mirrors the total annual imports Canada receives from the U.S., signaling a full-scale response. Trudeau stated the tariffs would remain “in place until the U.S. eliminates its tariffs against Canada”, underscoring that Canada’s countermeasures were dollar-for-dollar proportional (Canada's plan for retaliatory tariffs on the US | Reuters).

Political Statements and Rhetoric:
The war of words between Washington and Ottawa has been pointed. President Trump has defended his tariff strategy as necessary leverage. He touted tariffs as a “very powerful weapon” that past U.S. leaders failed to use “because they were either dishonest, stupid or paid off in some other form”, and insisted that taxing imports is the “easiest path to national prosperity” (US tariffs on Canada and Mexico take effect; China, Mexico and Canada retaliate - OPB) (US tariffs on Canada and Mexico take effect; China, Mexico and Canada retaliate - OPB). Trump’s hardline stance is popular with his political base, who view Canada’s trade practices (such as dairy tariffs and other barriers) as unfair to American farmers and manufacturers. On the other side, Prime Minister Trudeau and his ministers have voiced resolve and indignation. “We do not escalate and we do not back down,” said Deputy PM Chrystia Freeland, calling the U.S. decision “entirely unacceptable”. Trudeau has characterized Trump’s tariff justification as absurd, noting that Canada and the U.S. are close allies in defense. He argued it is absurd to label Canadian imports a security threat when “Canadian steel and aluminum” are integral to U.S. military equipment, and called the idea “quite frankly insulting”. Both leaders have thus dug in publicly – Trump framing the tariffs as a means to protect American interests and pressure foreign governments, and Trudeau framing Canada’s retaliation as a matter of national pride and economic self-defense.

It’s worth noting that relations had soured before: in 2018, Trump blasted Trudeau as “very dishonest & weak” via Twitter after a G7 summit, reacting to Trudeau’s pledge not to be intimidated (After a year of nice, Trump brings Trudeau to brink of trade war | Reuters) (After a year of nice, Trump brings Trudeau to brink of trade war | Reuters). By 2025, those personal barbs have evolved into full-fledged trade actions. Canadian nationalism has been on the rise in response, with even opposition parties largely backing Trudeau’s firm response to what is seen as U.S. bullying. Both countries claim to hope for a resolution but are trading sharp jabs in the meantime. As Trudeau put it, “a trade dispute is the last thing anyone needs – it will only hurt the economic recovery on both sides of the border. However, this is what the U.S. administration has chosen to do”.

2. Economic Impact on the U.S. and Canada

Goods and Industries Affected:
Canada’s retaliatory tariff list is sweeping. The first tranche of Canadian tariffs at 25% covers 1,256 U.S. products, hitting a wide array of consumer and industrial goods (Canada's plan for retaliatory tariffs on the US | Reuters). These include everyday grocery items and household products (Florida orange juice, peanut butter, chocolate, coffee, ketchup and other condiments), alcoholic beverages (American whiskey/bourbon and wine), kitchen appliances and washing machines, home furnishings, toilet paper, apparel and footwear, motorcycles, boats, and paper products (Canada's plan for retaliatory tariffs on the US | Reuters). The initial targeted imports amount to C$30 billion and span staples of American exports, from farm produce to manufactured goods. Canadian officials chose many of these items strategically to inflict pain on key U.S. industries and political constituencies – for example, orange juice targets Florida’s citrus farmers, whiskey hits distilleries in Kentucky, and motorcycles (as in 2018) nod to iconic brands like Harley-Davidson.

Canada also signaled a second tranche of tariffs after 21 days, potentially extending the 25% duties to an additional C$125 billion in U.S. goods if the dispute continues (Canada's plan for retaliatory tariffs on the US | Reuters) (Canada's plan for retaliatory tariffs on the US | Reuters). This second round would broaden the impact to major sectors including passenger vehicles and auto parts, trucks and electric vehicles, steel and aluminum products, agriculture and food items like fruits, vegetables, beef, pork, and dairy, and even aerospace products (Canada's plan for retaliatory tariffs on the US | Reuters). In sum, virtually every major U.S. export to Canada could be subject to tariffs, from farm to factory. The retaliation is deliberately wide-ranging: “The Canadian list of goods…includes aluminum bars, plates, refrigerators, bicycles, washing machines and golf clubs,” as one account noted (pointedly referencing Trump’s love of golf). By value, some of the largest categories in the first wave are cosmetics and personal care items (C$3.5 billion worth), appliances and household items (C$3.4 billion), pulp and paper (C$3 billion), and plastics (C$1.8 billion) (Canada's plan for retaliatory tariffs on the US | Reuters).

On the U.S. side, the American tariffs hitting Canada are equally consequential. A 25% U.S. tariff on essentially all Canadian exports (except energy at 10%) means higher costs for U.S. businesses and consumers who rely on those goods (2025 United States trade war with Canada and Mexico - Wikipedia). Key Canadian exports to the U.S. include automobiles and auto parts, industrial machinery, petroleum and natural gas, lumber and building materials, aircraft and parts, and various food products. For instance, U.S. auto manufacturers import many components from Canadian suppliers – those parts now cost 25% more, raising production costs for U.S. cars and trucks. Canadian oil and gas, which accounts for a significant share of U.S. energy imports, now faces a 10% levy, potentially increasing fuel costs for American refiners and consumers. The new U.S. tariffs also re-impose duties on Canadian steel and aluminum (Trump separately reapplied a global 25% tariff on steel and 10% on aluminum in February 2025) (2025 United States trade war with Canada and Mexico - Wikipedia), which is a blow to Canadian metal producers and U.S. industries that use those metals (like construction and aerospace).

Impact on Canadian Consumers and Businesses:
For Canada, retaliating is a double-edged sword. While these counter-tariffs are designed to pressure the U.S., they also raise prices for Canadian importers and consumers on a huge range of American goods. Canadian companies that rely on U.S. inputs – whether it’s machinery, raw materials, or ingredients – will see their costs jump, unless they can find alternative suppliers. Ordinary Canadians will notice certain American-made products from groceries to gadgets getting more expensive in stores. This is inherently inflationary: economists warn such broad tariffs will “increase consumer prices” in Canada (and the U.S. alike) (2025 United States trade war with Canada and Mexico - Wikipedia). Indeed, the mere announcement of the trade war “raised fears of higher inflation” on both sides of the border (US tariffs on Canada and Mexico take effect; China, Mexico and Canada retaliate - OPB). Canadian inflation, already a concern, could tick upward if tariffs persist, especially on food and consumer staples.

Businesses in Canada may try to mitigate the impact by sourcing goods domestically or from other countries not subject to the tariff (for example, importing orange juice from Brazil instead of Florida, or buying European ketchup instead of American). The Canadian government has also set up a remission process to consider relief for Canadian firms hurt by the tariffs (Canada's plan for retaliatory tariffs on the US | Reuters). Still, substitution is not always possible in the short term, and some smaller businesses could face a squeeze on profit margins. Industries that use a lot of U.S.-made equipment or parts (like construction, farming, or manufacturing) will feel the pinch. The Canadian auto manufacturing sector, for instance, depends heavily on U.S. parts – until now duty-free under USMCA. Those parts are now pricier, which undermines Canadian auto plants’ competitiveness and could threaten jobs unless resolved.

There is also a broader economic risk for Canada given its heavy reliance on trade with the U.S. Approximately 75% of Canada’s goods exports go to the United States, so any disruption to that flow is significant. Analysts note that Canada’s economy could slow markedly or even tip into recession if the tariffs drag on, due to reduced export demand and general uncertainty (Safe Haven From the Trade War? | Charles Schwab) (Safe Haven From the Trade War? | Charles Schwab). Recognizing this vulnerability, Canada is exploring non-tariff retaliation too, such as export controls on critical minerals or energy destined for the U.S. (Canada's plan for retaliatory tariffs on the US | Reuters). Such measures (for example, restricting exports of lithium or rare earths crucial to U.S. industries) could give Canada additional leverage, though they also risk further fragmenting integrated supply chains.

Impact on U.S. Consumers, Farmers and Industries:
In the United States, consumers will likewise feel pain. The tariffs that Trump imposed act as a tax on imported Canadian goods – meaning American buyers of those goods will pay more. The U.S. tariffs encompass everything from Canadian steel for factories to Canadian lumber for homebuilding to Canadian maple syrup on grocery shelves. American manufacturers using Canadian inputs face higher costs, which often get passed to consumers. Automobiles and appliances assembled in the U.S., for instance, may become more expensive as input costs rise. At the same time, Canada’s retaliatory tariffs make U.S. exports less competitive in the Canadian market. American farmers and companies suddenly find their products priced up to 25% higher in Canada, likely causing a drop in demand. For example, a U.S. peanut butter or yogurt producer now faces a 25% duty at the Canadian border; Canadian distributors might switch to domestic or European suppliers, leaving the U.S. exporter with lost sales. Industries like agriculture and food processing are hard hit – Canada is a top market for U.S. farm exports (it’s traditionally the #2 or #3 destination for American agricultural goods). With tariffs up to 25%, Canadian buyers may import fewer U.S. fruits, meats, and dairy, hurting American farmers and ranchers. Economists note that higher tariffs on U.S. agricultural products will “negatively impact” the U.S. agriculture sector (Stocks and bond yields slip as Trump tariffs ignite new trade conflicts | Reuters) (Stocks and bond yields slip as Trump tariffs ignite new trade conflicts | Reuters), at a time when farmers were already squeezed by other trade battles (notably with China).

Certain U.S. states and regions are bearing a disproportionate brunt. For instance, states like Michigan and Ohio (autos), Wisconsin (dairy products), Pennsylvania (steel), and farm-belt states like Iowa and Florida (various crops) are directly in the crossfire of Canadian retaliation. Some small manufacturers in the U.S. that count Canada as a major export market could see layoffs or cutbacks if orders dry up due to the tariff wall. The U.S. Chamber of Commerce and industry groups have warned that the trade war will ultimately cost American jobs and raise costs for consumers nationwide. This sentiment is backed by many economists: trade conflicts with key partners like Canada and Mexico “could wind up increasing costs for consumers while destabilizing markets and global supply chains,” experts warn (Trump’s trade war triggers recession fears - POLITICO). One analysis by Bank of America projected that an all-out trade war scenario could significantly reduce U.S. economic growth and even risk a recession if business confidence declines and supply chains are severely disrupted (Trump’s trade war triggers recession fears - POLITICO).

Supply Chain Disruptions:
North America’s supply chains are famously interwoven thanks to decades of free trade under NAFTA/USMCA. The sudden imposition of tariffs introduces major frictions into this system. Industries such as automotive are a prime example – a car built in Ontario might contain an engine from Michigan and electronics from Mexico, with components crossing borders multiple times during production. Tariffs at each crossing threaten to “upend supply chains across North America” (2025 United States trade war with Canada and Mexico - Wikipedia), forcing companies to consider costly adjustments. Some U.S. companies might rethink sourcing from Canadian suppliers if tariffs persist, potentially switching to domestic or other foreign sources (which can be disruptive and time-consuming). Canadian firms, likewise, may diversify away from U.S. suppliers or customers. In the short term, expect logistical complications: shipments caught in transit as tariffs kicked in faced confusion (Canada at least exempted goods already in transit (Canada's plan for retaliatory tariffs on the US | Reuters)). Over the longer term, prolonged barriers could drive structural changes – like U.S. importers establishing warehouses to stockpile critical Canadian goods in case of delays, or Canadian exporters seeking new markets overseas.

Specific supply chains are already experiencing strain. For instance, a significant share of Maine’s lobster and blueberry harvests are sent to Canada for processing and then re-exported to the U.S. – a quirky cross-border supply loop. A U.S. Senator from Maine noted that “Maine and Canada’s economy are integrated”, and these tariffs threaten to disrupt such arrangements (US tariffs on Canada and Mexico take effect; China, Mexico and Canada retaliate - OPB). Another example: the aerospace sector, where parts for aircraft engines may move between Quebec and Connecticut multiple times – tariffs here raise costs and complicate compliance with USMCA’s rules of origin. Small businesses on the border are also hurting; many participate in cross-border trade that now faces tariffs, cutting into razor-thin margins.

In summary, the economic fallout of this U.S.-Canada trade crossfire is mutually damaging. Canada’s retaliatory duties strike at a broad swath of U.S. industries and will make many Americans’ products costlier in Canada (causing U.S. exporters to lose market share). Trump’s tariffs, in turn, tax Canadian inputs that many U.S. factories depend on, and will make many finished goods pricier for American consumers. Both economies are sizable and diversified, so a trade war between them won’t collapse either overnight – but it will act as a drag on growth. Early estimates by economists suggest the trade war could shave off economic growth on both sides (one estimate posited that even a moderate 10% across-the-board tariff could trim global GDP growth by 0.1% in 2025 (Five Investing Impacts of a Trade War | Charles Schwab), and here we have 25% tariffs, indicating a potentially larger effect). Canadian and U.S. government officials are quietly hoping for a resolution before too much damage is done, but publicly both remain defiant. As one economist summed up: “A decline in confidence and supply chain disruptions could amplify the trade shock, leading to an outright recession” if the standoff intensifies (Trump’s trade war triggers recession fears - POLITICO).

3. Stock Market Reactions

Initial Shock and Volatility:
Financial markets reacted swiftly to the escalation of the trade dispute. In the days surrounding the March 4, 2025 tariff implementation, U.S. and Canadian stocks tumbled amid investor anxiety. On March 3, when President Trump confirmed the tariffs would proceed, Wall Street saw a sharp sell-off – the S&P 500 index fell about 1.8% in a single day and the tech-heavy Nasdaq dropped around 2.6% (2025 United States trade war with Canada and Mexico - Wikipedia). By early March, the S&P 500 was down roughly 5% from its all-time high reached in February (Stocks and bond yields slip as Trump tariffs ignite new trade conflicts | Reuters), erasing gains made earlier in the year. Toronto’s TSX index likewise fell as the Canadian market absorbed the news of retaliatory tariffs and the prospect of slower growth. Shares in Europe and Asia also turned red, reflecting fears that a broader global trade war was unfolding (US tariffs on Canada and Mexico take effect; China, Mexico and Canada retaliate - OPB). In Europe, major indexes fell ~1-2% on March 4, with internationally-exposed sectors hit hardest (Stocks and bond yields slip as Trump tariffs ignite new trade conflicts | Reuters).

Sector Winners and Losers:
Unsurprisingly, the automotive sector was among the hardest hit. Auto manufacturers and parts suppliers rely heavily on North American trade, and the prospect of 25% tariffs on cars and components sent auto stocks plunging. In Europe, auto stocks sank over 4% on March 4 – their worst day in years (Stocks and bond yields slip as Trump tariffs ignite new trade conflicts | Reuters). In the U.S., shares of Detroit’s Big Three automakers (GM, Ford, and Stellantis), as well as electric vehicle makers and auto parts companies, suffered substantial declines on the tariff news. These companies face higher input costs (due to tariffs on Canadian parts and metals) and potential retaliatory hits to their export sales. Agriculture-related stocks also stumbled. Companies tied to farming – from equipment makers like Deere & Co. to fertilizer producers to food processors – saw pressure as China and Canada both targeted U.S. agricultural exports in retaliation (US tariffs on Canada and Mexico take effect; China, Mexico and Canada retaliate - OPB) (US tariffs on Canada and Mexico take effect; China, Mexico and Canada retaliate - OPB). For example, if Canada slaps a tariff on U.S. beef or pork, that could hurt American meatpacking firms’ revenues; if China (concurrently) taxes U.S. soybeans or corn, it hits U.S. agribusiness broadly. Investors, anticipating lower demand and farm incomes, rotated away from such stocks.

Industrial and manufacturing firms, especially those in aerospace, machinery, and construction equipment, experienced mixed fortunes. Companies heavily reliant on cross-border supply chains or exporting to Canada/Mexico saw their stock dip. For instance, a U.S. appliance maker selling many units in Canada would be hit by Canada’s import tax. On the other hand, U.S. steel and aluminum producers enjoyed a boost – the tariffs protecting those industries lifted domestic prices for metals, which in turn lifted steelmakers’ shares (2025 United States trade war with Canada and Mexico - Wikipedia). Nucor and U.S. Steel stock jumped after Trump re-imposed metal tariffs globally, as investors bet on improved profit margins for U.S. mills (though this optimism could be tempered by the risk of higher costs for their customers). Another pocket of strength was aerospace and defense stocks, which paradoxically hit record highs in Europe (Stocks and bond yields slip as Trump tariffs ignite new trade conflicts | Reuters) and performed well in the U.S. too. Analysts attributed this to a few factors: aerospace firms often have long-term contracts and may be seen as insulated from short-term trade issues; defense contractors might benefit from increased geopolitical tensions (as governments bolster defense spending); additionally, any hint that civil aerospace (like Boeing-Airbus competition) could become politicized might have boosted U.S. defense-oriented names.

Bond Markets and Currencies:
The trade turmoil drove a classic flight-to-safety in the bond market. Investors piled into government bonds, pushing yields down on both U.S. Treasurys and Canadian government bonds. The U.S. 10-year Treasury yield fell to its lowest level since October 2024 (Stocks and bond yields slip as Trump tariffs ignite new trade conflicts | Reuters), as demand for safe assets rose amid the stock sell-off. In Canada, bond yields likewise likely declined given expectations that the Bank of Canada might need to adopt an easier policy stance if the economy weakens. The currency markets also reflected the stress: the Canadian dollar (CAD) weakened against the U.S. dollar, reaching one-month lows in early March (Stocks and bond yields slip as Trump tariffs ignite new trade conflicts | Reuters). A weaker CAD helps offset some tariff pain for Canadian exporters (their goods become cheaper in USD terms), but it also makes imports (already tariffed) even pricier, a double whammy for Canadian consumers. The Mexican peso similarly fell. Interestingly, the U.S. dollar strengthened against a basket of currencies, benefitting from its safe-haven status and higher interest rates, although a too-strong dollar can further weigh on U.S. exporters.

Investor Strategies and Sentiment:
Investors have been adjusting their strategies in light of the trade war’s uncertainties. Many portfolio managers moved to reduce exposure to trade-sensitive equities – for example, underweighting industrials, automakers, and semiconductor firms (since a related U.S.-China spat is also brewing) – while increasing allocations to defensive sectors like utilities, healthcare, or consumer staples that are less directly affected by tariffs. Some are shifting funds into safe-haven assets: gold prices have climbed through 2025 as trade tensions rose, and bond funds have seen inflows. “The capital markets are responding to the uncertainty of a trade war by adopting a more risk-averse mindset,” noted one traders’ commentary, reflecting a more cautious stance across the board. Volatility indices spiked during the tariff announcements, and traders have been actively hedging with options to guard against further market swings.

However, not all investors are bearish. A contingent of analysts sees the sell-off as a potential buying opportunity. Their reasoning: if this trade war proves temporary or if a negotiated resolution emerges, stocks could rebound strongly. Historical comparisons were cited – during the 2018-2019 U.S.-China trade war, markets had episodic drops but also sharp recoveries when tensions cooled. Some point out that Trump often uses aggressive tariffs as a negotiating tactic, then backs down or compromises. Indeed, one 2024 analysis by Charles Schwab noted that Trump’s tariff moves might be “more bark than bite” and could be “abruptly dropped or sharply reduced” if political objectives are met (Safe Haven From the Trade War? | Charles Schwab). This camp argues that fundamentally sound companies now trading at a discount due to tariff fears might be attractive buys for long-term investors. For example, if auto tariffs are lifted in a few months, auto stocks could rally from their beaten-down levels. Thus, contrarian investors are selectively bargain-hunting in sectors that they believe have overreacted.

Overall, market sentiment is jittery. The word “uncertainty” comes up frequently in financial commentary. “It’s chaotic… It’s unpredictable. We don’t know what the president will do,” said one trade lawyer of the evolving situation (US tariffs on Canada and Mexico take effect; China, Mexico and Canada retaliate - OPB). That unpredictability is keeping some investors on the sidelines, holding higher cash positions until clarity emerges. Many are closely watching diplomatic signals for any hint of de-escalation or, conversely, further escalation (such as additional U.S. tariffs on other countries or products). It’s a delicate moment where headlines from Washington or Ottawa can roil markets in either direction. As one chief economist quipped amid a flurry of developments: “Everyone is caught by the onslaught. You have the news on tariffs, [and other geopolitical news].” (Stocks and bond yields slip as Trump tariffs ignite new trade conflicts | Reuters) The trade war has firmly put markets on edge, with heightened volatility likely to persist until a clearer path forward is established.

4. Cryptocurrency Market Reaction

The burgeoning cryptocurrency market has not been immune to the waves from the trade dispute – though its reaction has been complex. In times of geopolitical or economic uncertainty, some crypto enthusiasts argue that assets like Bitcoin can serve as a “safe haven” similar to gold. Indeed, during previous episodes of trade tension (such as the U.S.-China trade war in 2019), Bitcoin saw surges of buying. Data from eToro showed that on days when trade-war news hit, investors often piled into both gold and Bitcoin; for example, when China announced retaliatory tariffs in May 2019, “the number of new bitcoin positions [on the platform] soared 139%” (gold positions jumped 108% by comparison) (Bitcoin Viewed As Safe Haven Like Gold During US-China Trade War - Business Insider). Such patterns suggest that a segment of investors turns to crypto as a hedge against turmoil in traditional markets.

Immediate Crypto Response in 2025:
In the immediate wake of the tariff announcement in early March 2025, major cryptocurrencies experienced volatility in line with risk assets. Initially, there were signs of Bitcoin rising – perhaps due to speculation that North American instability could boost alternative assets. In fact, in late February 2025, Bitcoin’s price rallied to around $88,000, a surge possibly fueled by traders anticipating increased demand as the trade war loomed. However, as the tariffs actually took effect and global markets convulsed, Bitcoin pulled back sharply, showing that it is not insulated from broad sell-offs. By March 4, Bitcoin slipped back under the $84,000 mark, erasing its early-week gains amid the broader market slump (Stocks and bond yields slip as Trump tariffs ignite new trade conflicts | Reuters) (Stocks and bond yields slip as Trump tariffs ignite new trade conflicts | Reuters). This mirrored the pattern seen during other bouts of volatility (Bitcoin often initially rises on a narrative of being a hedge, but can decline if a severe equity sell-off forces investors to raise cash). Other leading crypto assets followed suit: Ethereum and others saw initial strength followed by a retreat.

Crypto market analysts note that short-term correlations between Bitcoin and equities can turn positive during liquidity crises – meaning when stocks drop fast, some investors sell crypto holdings as well to cover losses or reduce risk, causing crypto to drop in tandem. That seemed to be the case in early March: “Cryptoassets sold off sharply in line with traditional risk assets” as the trade war news hit, observed a Bitwise report (Bitcoin Faces Near-Term Headwinds as Trade War Escalates, but Long-Term Tailwinds Strengthen | Bitwise Weekly Crypto Market Compass | Bitwise). Contributing factors included a strengthening U.S. dollar (which tends to pressure Bitcoin’s USD price downward) (Bitcoin Faces Near-Term Headwinds as Trade War Escalates, but Long-Term Tailwinds Strengthen | Bitwise Weekly Crypto Market Compass | Bitwise) and a general “risk-off” sentiment that hurt speculative investments. So in the immediate term, Bitcoin acted more like a risk-sensitive asset than a safe haven – at least at the onset of this trade conflict.

Safe-Haven or Risk Asset?
The divergent movements have rekindled debate over whether crypto truly behaves as a hedge against economic uncertainty. On one hand, Bitcoin proponents highlight its gold-like properties. Bitcoin’s supply is capped at 21 million coins and it operates outside of government control, which means it cannot be inflated away or directly impacted by central bank or trade policies. “Bitcoin shares similar characteristics to gold in that there will only ever be a finite amount... it’s decentralized, its price is not affected by inflation,” noted Simon Peters, an analyst at eToro (Bitcoin Viewed As Safe Haven Like Gold During US-China Trade War - Business Insider). These qualities suggest that if investors fear currency debasement (for instance, if trade wars force central banks to loosen monetary policy or if government debts soar), they might seek refuge in Bitcoin as a store of value. Indeed, there are signs that perception is shifting – during the 2019 trade war, trading volumes and open positions in Bitcoin spiked alongside gold at key moments (Bitcoin Viewed As Safe Haven Like Gold During US-China Trade War - Business Insider) (Bitcoin Viewed As Safe Haven Like Gold During US-China Trade War - Business Insider). Some market observers have even dubbed Bitcoin “digital gold,” arguing it could play a similar role as a hedge in portfolios. Over the longer run, continued economic strife and inflationary pressures from trade tariffs could bolster the case for Bitcoin. If businesses and consumers lose confidence in fiat currencies or traditional banking during protracted trade conflicts, they might diversify into crypto as an alternative asset.

On the other hand, skeptics caution that crypto remains highly volatile and speculative, and thus an unreliable safe haven. “Bitcoin remains a more volatile asset than gold and faces additional risks,” Peters conceded, referring to extreme price swings and issues like exchange hacks or regulatory crackdowns (Bitcoin Viewed As Safe Haven Like Gold During US-China Trade War - Business Insider). During the current episode, the fact that Bitcoin first spiked and then dropped underscores its unpredictability. It’s entirely possible that in a severe global downturn, cryptocurrencies could crash even harder as speculative fervor dries up. Additionally, while some investors use Bitcoin to hedge, others might view it as just another risk asset – meaning its fate is tied to overall market liquidity conditions. The correlation between Bitcoin and equities has increased at times in recent years, especially as more institutional money (which manages crypto and stocks side-by-side) has entered the space. So rather than acting like a stable hedge, Bitcoin could continue to trade in tandem with riskier assets if panic worsens.

What about other cryptocurrencies?
Bitcoin has been the main focus as a potential hedge, given its dominant market status and fixed supply narrative. Other cryptos like Ethereum have different value propositions (Ethereum, for instance, is more tied to applications and may be viewed more like a tech investment). In the recent turbulence, Ethereum also fell, roughly tracking the NASDAQ’s decline percentage-wise. More speculative altcoins saw even larger swings, reminding investors that these assets can behave more like high-beta tech stocks than safe havens. Stablecoins, which are cryptocurrencies pegged to stable assets (often the U.S. dollar), saw increased demand – a sign that some crypto traders were seeking shelter in dollar-linked tokens to wait out the volatility.

Crypto as a Hedge: Expert Insights:
Crypto industry figures have weighed in on the trend. Many point out that institutional interest in Bitcoin often grows during macroeconomic uncertainty. Pantera Capital, a crypto-focused fund, reported rising inquiries from investors looking at Bitcoin as an uncorrelated asset amid trade and political tensions (Bitcoin Is 2019's Best-Performing Asset, Even After Recent Price Downturn) (Bitcoin Is 2019's Best-Performing Asset, Even After Recent Price Downturn). They note a “fear of missing out” if Bitcoin were to rally on chaos. Some Wall Street analysts have started to mention Bitcoin in the same breath as gold when discussing hedges. Markets Insider reported that open positions in Bitcoin and gold have shown spikes in parallel during trade escalation headlines (Bitcoin Viewed As Safe Haven Like Gold During US-China Trade War - Business Insider). The rationale is that Bitcoin’s value is not directly tied to any single economy or company, so it might hold value if traditional markets falter. Additionally, if the trade war leads to more money printing or interest rate cuts to stimulate struggling economies, that could weaken fiat currencies and potentially strengthen Bitcoin’s appeal (since Bitcoin’s supply is fixed and it’s immune to central bank policies) (Bitcoin Is 2019's Best-Performing Asset, Even After Recent Price Downturn).

Still, financial advisors urge caution. “Bitcoin is slowly becoming digital gold, but it’s not there yet,” said one crypto research head, noting that its track record is short and its behavior inconsistent (Bitcoin Is 2019's Best-Performing Asset, Even After Recent Price Downturn). During the worst of the March sell-off, Bitcoin did not rise like a true inverse safe haven – it fell. This suggests that crypto is not a straightforward hedge at this stage, but rather a diversifier that might shine in specific scenarios (such as high inflation) but not in others (like a sudden liquidity crunch). Some experts believe that if the trade war causes an inflationary spike or a loss of confidence in government policies, Bitcoin and maybe top-tier cryptocurrencies could benefit; however, if the main outcome is reduced economic activity and a risk-off environment, crypto might struggle along with equities.

In the past few weeks since the tariffs were enacted, Bitcoin has stabilized and even climbed off its lows, trading in the mid-$80k range again, as investors digest the new normal of the trade war. Crypto believers interpret this resilience as a sign of strength – perhaps indicating that once the initial shock passed, the underlying demand to use crypto as a hedge or alternative asset remains robust. Indeed, volumes on peer-to-peer bitcoin trading platforms in Canada ticked up in late March and June, possibly reflecting some Canadians moving savings into crypto as a guard against further economic trouble. Crypto exchanges have reported an uptick in new user signups from North America since the trade dispute began, suggesting growing public interest in diversifying into crypto.

In summary, the cryptocurrency market’s reaction has been two-sided: initial volatility aligned it with other risk assets, but there are undercurrents of investors positioning Bitcoin as a longer-term hedge against the uncertainty unleashed by the trade war. Whether crypto truly serves as a safe haven will ultimately be proven over time. For now, it remains an intriguing but volatile piece of the global market puzzle amid this U.S.-Canada standoff.

5. Expert Predictions on Future Impact

With the trade conflict still unfolding, experts are actively debating how long it might last and what the eventual outcome will be. Predictions range from a short-lived skirmish to a protracted economic cold war. Here’s a synthesis of prevailing views on the future impact:

Duration of Tariffs and Possible Resolutions:
Some analysts believe these tariffs could be short-lived if they achieve their political aims. President Trump has shown a pattern of imposing tariff threats to extract concessions, then lifting them if he can declare a victory. Recall that in 2019, Trump threatened Mexico with tariffs over immigration, only to withdraw them when Mexico agreed to certain border measures. A similar dynamic might play out here: both Canada and Mexico have been working to address U.S. concerns (stepping up border security and anti-smuggling efforts). If the U.S. deems those efforts sufficient or secures some face-saving deal, Trump could abruptly roll back the tariffs. A White House fact sheet even hinted that tariffs could come down if the U.S. sees improvements on the issues of drugs and immigration (US tariffs on Canada and Mexico take effect; China, Mexico and Canada retaliate - OPB). Indeed, Jeff Kleintop, chief global investment strategist at Charles Schwab, noted that tariff policies in early 2025 have often been “announced and then subsequently rescinded or delayed”, suggesting they may end up “more bark than bite” in the end (Safe Haven From the Trade War? | Charles Schwab). His team’s base case was that while tariff headlines would cause volatility, they expected a positive market outlook for the year on the assumption that worst-case tariffs might be rolled back sooner than expected (Safe Haven From the Trade War? | Charles Schwab).

On the other hand, many experts warn of a protracted standoff. Trump’s demands – such as completely stopping illegal drug flows – are highly ambitious and not easily measurable. Canada (and Mexico) may not be able to satisfy the U.S. to the degree demanded, especially since those issues are partly outside their control. Moreover, Canada views the U.S. tariffs as a breach of the USMCA trade agreement (2025 United States trade war with Canada and Mexico - Wikipedia) and might be reluctant to negotiate under duress. If political pride and sovereignty concerns dominate, neither side may back down quickly. Some trade veterans recall the U.S.-China trade war, which dragged on for over two years (2018-2020) before a “Phase One” truce – and even then, many tariffs stayed in place. A study on the U.S.-China dispute projected a low probability of it ending swiftly, and by analogy, a U.S.-Canada tariff war could also grind on longer than markets hope (Why the US-China trade war could last another five years). Notably, the tariffs are already in effect and causing pain; undoing them might require substantial diplomatic effort or a change in leadership. If President Trump remains steadfast through his term, this could become an ongoing feature of U.S.-Canada economic relations, potentially up to the 2028 U.S. elections or Canada’s next election, unless resolved earlier.

Economic Trajectory – Quick Recovery or Prolonged Downturn?:
The consensus among economists is that as long as these tariffs persist, they will be a headwind to growth. Forecasts for both countries’ GDP in 2025 have been revised downward by various institutions. For example, some private-sector economists trimmed Canada’s 2025 growth forecast from ~2% to ~1% or lower, factoring in reduced exports and business investment. The U.S. economy, while larger and somewhat less trade-dependent, could also see growth slowed by a few tenths of a percent. If the confrontation escalates (for instance, if Trump were to impose even more tariffs on other trading partners or if Canada imposed the full C$155 billion retaliation and perhaps additional non-tariff measures), the risk of a mild recession in 2026 cannot be ruled out. Bank of America’s Ethan Harris warned that a “major trade war” scenario could “lead to a significant reduction in growth” and a loss of business confidence that might tip the U.S. into recession (Trump’s trade war triggers recession fears - POLITICO). Similarly, Schwab’s analysis cautioned that Canada and Mexico’s high export dependence means their economies are at risk of slipping into recession if the 25% tariffs fully materialize and linger (Safe Haven From the Trade War? | Charles Schwab) (Safe Haven From the Trade War? | Charles Schwab).

However, if a resolution or partial deal is reached in the coming months, the outlook could brighten quickly. Markets are forward-looking – any credible signs of a deal (for instance, if the U.S. and Canada announce new negotiations or if tariffs are paused) would likely spark a relief rally in stocks and a pickup in business confidence. Companies might restart shelved investments once they see stability. Thus, markets could recover swiftly if the trade war is defused sooner than later. This is essentially an upside scenario that some optimists are betting on.

On the flip side, a prolonged downturn is possible if the dispute drags on or widens. Should the U.S. expand tariffs to other countries (Trump has threatened the EU, India, etc., and even specific sectors like autos and microchips (US tariffs on Canada and Mexico take effect; China, Mexico and Canada retaliate - OPB)), or if Canada doubles down and perhaps coordinates with other nations to isolate the U.S., we could see a broader global slowdown. In a worst-case scenario, multiple trade wars could contribute to a global recession. This is the doomsday outcome that market bears worry about – one where supply chain disruptions persist for years, businesses hold off on expansions, and consumers face persistent price increases, all dampening economic activity.

Investor Outlook – Risk or Opportunity?:
Financial experts are split on whether the current environment presents a buying opportunity or if caution should prevail. Optimistic voices, including some fund managers, argue that much of the “trade war fear” is already priced into markets after the recent corrections. They note that valuations for trade-sensitive stocks are now lower, and any positive news could lead to outsized gains. For instance, if one anticipates that the U.S. and Canada will come to the negotiating table by the fall and suspend tariffs, then buying cyclical stocks (like auto or industrial companies) now at depressed prices could yield strong returns. Similarly, crypto investors with a high risk tolerance might view any dip in Bitcoin (which has still roughly doubled over the past year) as a chance to accumulate, expecting that continued economic uncertainty and global monetary easing will eventually boost decentralized assets.

Conversely, many advisors urge prudence given the elevated risks. They emphasize that trying to time the resolution is difficult – if the conflict worsens, markets have further to fall. “Markets have not taken trade wars seriously enough, we fear... both assumptions (that Trump is bluffing and others will back down) may turn out to be too optimistic,” warned BNP Paribas economists during a prior flare-up (Trump’s trade war triggers recession fears - POLITICO). That cautionary note resonates now: despite the drops, stock indexes are not in bear market territory yet, so a deeper slide could occur if earnings start reflecting tariff impacts. For crypto, skeptics point to its historical volatility; a sudden regulatory action or simply a shift in market sentiment could send prices plunging irrespective of the trade war. In short, this camp suggests maintaining diversified portfolios, hedging downside (via put options or assets like gold), and avoiding over-concentration in any vulnerable sector until clarity improves.

Possible Resolutions and Wildcards:
Experts outline a few scenarios that could resolve the impasse:

• Bilateral Negotiation: The U.S. and Canada could strike a deal where the U.S. lifts the tariffs in exchange for certain concessions. These might include new cooperative measures on border security (Canada has already appointed a “fentanyl czar” and boosted funding to curb smuggling (2025 United States trade war with Canada and Mexico - Wikipedia)), and perhaps some economic tweaks (e.g., Canada opening its dairy market a bit more, which was a Trump gripe). If such a deal is reached, expect a quick removal of tariffs and a bounce-back in trade flows.

• USMCA/Legal Challenge: Canada (and Mexico) could formally challenge the U.S. tariffs as violations of the USMCA trade agreement. They have already stated that Trump’s actions likely violate the deal’s terms (2025 United States trade war with Canada and Mexico - Wikipedia). The dispute mechanism under USMCA or a complaint at the World Trade Organization (WTO) could be pursued. However, these legal processes are slow and uncertain – they wouldn’t provide immediate relief, and the Trump administration has been dismissive of WTO rulings in the past.

• Political Change: Though speculative, one resolution could come from political shifts. In Canada, an election due by 2025 could, in theory, bring a new government (although any Canadian government would likely oppose U.S. tariffs just as strongly). In the U.S., if mounting economic pain flips American public opinion or if Congress (even members of Trump’s own party) apply pressure, it could force the administration to reconsider. There have been some Republican lawmakers voicing concern (e.g., Senator Susan Collins noted the harm to her state from these tariffs (US tariffs on Canada and Mexico take effect; China, Mexico and Canada retaliate - OPB)). If the trade war starts jeopardizing Trump’s domestic economic goals or popularity, he might seek an exit strategy.

One wildcard is the global context – this North American spat is happening alongside U.S. tensions with China and possibly others. Any resolution might be part of a broader reset of U.S. trade policy. Another wildcard is market pressure: a steep stock market decline or signs of economic distress (like a manufacturing slump or consumer pullback) could incentivize all sides to find a compromise more urgently. Essentially, if the costs become too high, cooler heads may prevail.

Crypto Market Predictions:
Turning to crypto specifically, experts in that arena also have varied predictions. Bullish crypto analysts suggest that if the trade war continues, it will underscore the appeal of borderless digital assets. They predict Bitcoin could ultimately benefit from inflation or currency instability triggered by tariffs. Some have even thrown out bold targets (e.g., $100k+ Bitcoin within a year) if global uncertainty remains elevated and more investors treat Bitcoin as digital gold. They also argue that younger investors and tech-savvy individuals are likely to increase crypto holdings as a hedge against what they see as government-induced economic turbulence.

On the other hand, cautious voices in crypto warn that a severe global downturn would hurt all asset classes, including crypto. In a recession scenario, people might not have spare money to invest in Bitcoin, or they might liquidate crypto to cover losses elsewhere. Furthermore, if the U.S. government’s relations with allies deteriorate, there’s a risk of regulatory backlash against crypto (for instance, more scrutiny on crypto flows under the guise of preventing capital flight or sanctions evasion). Such moves could dampen the market. Thus, while crypto might shine in an inflationary environment, it could suffer in a deflationary risk-off environment. For now, most expect crypto will continue to trade with elevated volatility, reacting not just to trade headlines but also to interest rate moves and regulatory developments that may follow from the trade war’s economic impact.

In summary, the future impact of Canada’s retaliatory tariffs and Trump’s trade war is highly uncertain, with outcomes ranging from a near-term deal (best case for markets) to a drawn-out conflict that weighs on the economy (worst case). Optimists foresee a scenario where pragmatism leads to compromise within months, allowing markets to rally and perhaps creating a buying opportunity at current depressed prices. Pessimists caution that we may be in for a bumpy ride that could last well into 2026, requiring investors and businesses to brace for sustained volatility and elevated risk. The truth may lie somewhere in between, but as of July 2025, planning for multiple contingencies is the prudent course.

6. Conclusion and Outlook

The U.S.-Canada trade dispute of 2025, marked by tit-for-tat tariffs, represents one of the most significant tests of the two countries’ economic relationship in decades. Key findings from this analysis highlight that:

• The clash originated from U.S. protectionist moves and unusual political linkages of trade to immigration/drug issues, which Canada views as unjustified. Historical context (e.g., the 2018 tariff episode) set the stage for Canada’s firm response, with leaders on both sides exchanging sharp rhetoric.

• Economically, the tariffs are a lose-lose: they encompass billions in goods from steel to ketchup, disrupting industries and raising costs for businesses and consumers in both nations. Supply chains that took years to integrate have been thrown into disarray, and inflationary pressures are an immediate concern.

• Financial markets reacted with apprehension – stocks slid especially in trade-sensitive sectors, and safe havens like bonds caught a bid. The Canadian and U.S. stock markets have experienced heightened volatility, reflecting the daily ebb and flow of trade news. Investors are rebalancing portfolios to navigate this new terrain.

• The cryptocurrency space, while relatively insulated from tariffs directly, is indirectly influenced by the macro turmoil. Bitcoin and its peers have shown signs of both vulnerability (selling off with equities) and strength (attracting those seeking an alternative hedge). Crypto’s role as a potential safe haven is still evolving.

• Expert opinions diverge on how this will resolve and what it means for the future. There is cautious hope that cooler heads will prevail before lasting damage is done, but also recognition that miscalculation or political steadfastness could prolong the pain.

Implications for businesses, investors, and consumers are profound. Companies in North America must prepare for a period of uncertainty – this could mean diversifying supply chains, seeking new export markets, or even pausing major capital expenditures until the trade outlook clears. Some firms might consider lobbying efforts, banding together with industry groups to urge a resolution. Investors should be ready for continued volatility; a prudent approach might involve maintaining a balanced asset allocation, hedging risk, and keeping an eye out for tactical opportunities (such as oversold stocks or dips in assets like crypto or gold that could serve as hedges). Consumers, unfortunately, may face higher prices on numerous products – being aware of this, they might adjust budgets or seek alternative goods (for example, buying local produce if imported ones become pricier).

In the near-term outlook, all eyes will be on diplomatic developments. Any sign of rapprochement – even a temporary tariff suspension to allow talks – would likely buoy markets and business sentiment. Conversely, further escalation (such as the implementation of Canada’s second tranche of tariffs on autos, or additional U.S. measures) would darken the outlook and could spur talk of recession risks. The coming months will also reveal how effective Canada’s retaliation is in practice: if U.S. exporters loudly complain and political pressure in the U.S. ramps up, it might accelerate negotiations. Similarly, the impact on Canadian inflation and the domestic economy will be closely watched; the Bank of Canada’s policy decisions for the rest of 2025 may hinge on how this trade shock evolves.

Looking further ahead, this dispute could reshape economic trends in a few ways. It may hasten a pivot in global trade alliances – for instance, Canada might deepen trade ties with Europe or Asia to reduce over-reliance on the U.S. market if American protectionism persists. There’s also a chance that this conflict spurs innovations in efficiency: businesses might adopt new technologies to offset higher costs (automation, localization of production, etc.). In the investment realm, the proven resilience (or lack thereof) of various asset classes during this episode will inform future strategy. If, say, Bitcoin holds its value or rises while equities falter, more investors might embrace crypto in the long run as part of diversification. If not, traditional hedges like gold and cash might regain favor.

In conclusion, the Canada-U.S. tariff battle as of mid-2025 has introduced significant uncertainty, but it is not without an endgame. The longstanding friendship and enormous mutual economic benefit between the two countries provide a strong incentive to find a solution. Businesses and investors should brace for volatility but not despair – trade wars are dangerous, yet history shows they eventually give way to new agreements when the cost gets too high. For now, prudent risk management and close attention to policy signals are essential. A balanced, level-headed outlook is warranted: hope for a reasonable compromise in the coming months, prepare for a rocky road until it happens, and be ready to adapt to whatever new normal emerges.

The next key checkpoints will be any bilateral meetings or mediation efforts, economic data releases revealing the tariff impact (e.g. trade volumes, inflation, manufacturing PMI trends), and political events (like party conventions or elections) that could change the calculus. Stakeholders across North America are riding out this storm with cautious optimism that cooler heads will prevail. Should a resolution be reached, it could unleash pent-up economic activity and relief in markets – a reminder that after the darkest clouds, brighter skies can return. Until then, the trade skirmish between Canada and the U.S. remains a central storyline shaping economic and market developments in 2025.

Sources:

• Reuters – Canada’s plan for retaliatory tariffs on the US (details on Canadian tariff lists and values) (Canada's plan for retaliatory tariffs on the US | Reuters) (Canada's plan for retaliatory tariffs on the US | Reuters).

• Reuters – U.S.-Canada-Mexico trade war timeline (2025) (background on Trump’s tariffs and Canada’s response) (2025 United States trade war with Canada and Mexico - Wikipedia) (2025 United States trade war with Canada and Mexico - Wikipedia).

• Reuters (2018) – Canada’s 2018 retaliation (Trudeau’s quotes and list of targeted goods) (After a year of nice, Trump brings Trudeau to brink of trade war | Reuters).

• POLITICO – Trudeau’s reaction to steel/aluminum tariffs (“insulting and unacceptable”).

• AP/OPB – Reporting on March 4, 2025 tariff effect (Trump quotes, market reactions, political responses) (US tariffs on Canada and Mexico take effect; China, Mexico and Canada retaliate - OPB) (US tariffs on Canada and Mexico take effect; China, Mexico and Canada retaliate - OPB).

• Reuters – Market wrap March 4, 2025 (stock indices moves, sector impacts, Bitcoin slip) (Stocks and bond yields slip as Trump tariffs ignite new trade conflicts | Reuters) (Stocks and bond yields slip as Trump tariffs ignite new trade conflicts | Reuters).

• Business Insider – Bitcoin as safe haven during trade war (surge in positions alongside gold) (Bitcoin Viewed As Safe Haven Like Gold During US-China Trade War - Business Insider) (Bitcoin Viewed As Safe Haven Like Gold During US-China Trade War - Business Insider).

• Business Insider – Crypto analyst on Bitcoin’s evolving role (finite supply, store of value perception) (Bitcoin Viewed As Safe Haven Like Gold During US-China Trade War - Business Insider) (Bitcoin Viewed As Safe Haven Like Gold During US-China Trade War - Business Insider).

• Reuters/Politico – Expert warnings on trade war impact (recession risk, supply chain disruption) (Trump’s trade war triggers recession fears - POLITICO) (2025 United States trade war with Canada and Mexico - Wikipedia).

• Charles Schwab analysis (2024/2025) – trade war scenarios and market impact outlook (Safe Haven From the Trade War? | Charles Schwab) (Safe Haven From the Trade War? | Charles Schwab).

• Reuters – Trump/Trudeau quotes and G7 fallout (Trudeau: “will not be pushed around”; Trump tweet) (After a year of nice, Trump brings Trudeau to brink of trade war | Reuters) (After a year of nice, Trump brings Trudeau to brink of trade war | Reuters).

• Bitwise Crypto Market Compass (2025) – crypto market response to tariffs (short-term sell-off with risk assets) (Bitcoin Faces Near-Term Headwinds as Trade War Escalates, but Long-Term Tailwinds Strengthen | Bitwise Weekly Crypto Market Compass | Bitwise).

• Reuters – Chrystia Freeland statement (Canada won’t back down, calls U.S. move unacceptable).

• Politico – U.S. business and economist reactions (trade war could undo gains, risk of recession) (Trump’s trade war triggers recession fears - POLITICO) (Trump’s trade war triggers recession fears - POLITICO).

• Reuters – Stocks reaction summary (autos down, safe havens up, S&P off highs due to tariffs) (Stocks and bond yields slip as Trump tariffs ignite new trade conflicts | Reuters) (Stocks and bond yields slip as Trump tariffs ignite new trade conflicts | Reuters).

Canada’s Retaliatory Tariffs on U.S. Goods: A 2025 Trade War Analysis