CUSMA has served as a critical backstop for Canada-US trade amid the US administration’s aggressive tariff stance. Product-specific measures (steel, aluminum, autos, lumber, etc.) have hurt Canada’s economy, but about 90% of US imports from Canada have remained duty free largely thanks to CUSMA. …While no agreement was reached on July 1 to extend CUSMA, the deal doesn’t expire until 2036, and tariff rates don’t change as a result. Indeed, the renewal process built into CUSMA anticipated that extending the agreement could be politically challenging. Therefore, it requires all three parties to begin negotiating a decade before its 2036 expiry—a process that formally begins now. Near-term trade risks for Canada haven’t gone away. …But, we continue to view the outright termination of CUSMA as unlikely. Decades of free trade in North America leaves strong incentives to preserve the deal. Indeed, in the proposed U.S. Section 301 measures, CUSMA exemptions were preserved again.