What a Trump presidency could mean for Canadian pocketbooks
To play on a familiar saying: if America sneezes and the world catches a cold, Canada is the first to get sick. As Donald Trump prepares to take office for a second term, Canadians are bracing for a range of policy changes that will inevitably affect our economy — and, by extension, our pocketbooks. While stock and bond markets are already reacting in anticipation of the changes, just how far Trump will go on issues such as trade and immigration remains to be seen. Here’s a look at what economists are predicting could lie ahead.
Canada and the U.S. are each other’s closest international partners, with daily trade topping $3.6 billion, according to the Canadian Chamber of Commerce. Canada buys three quarters of America’s merchandise exports, to the tune of approximately US$500 billion a year, and nearly $600 billion in Canadian exports go to the U.S.
While Bank of Montreal chief economist Douglas Porter said Canada’s economy might initially benefit from stronger U.S. growth, Canada would be one of the hardest hit from a possible trade tussle. One of Trump’s campaign promises was a 10 per cent tariff on all goods imported into the U.S. That, and the fate of the United States–Mexico–Canada Agreement (USMCA), which is up for review in 2026, could depress capital flows to Canada and weaken domestic investment, likely extending Canada’s productivity slump.
However, CIBC chief economist Avery Shenfeld noted that what Trump has said on tariffs and other trade barriers during his campaign may not all come to fruition. During Trump’s first term, there was a threat to end NAFTA, but the outcome was an updated trade pact, and tariffs on Canadian steel and aluminum were reversed after a year, Shenfeld said. Plus, one of Trump’s main
Read more on financialpost.com
