The U.S. and Canada could pull back from an all-out trade war. It’s not clear that they will

By Paul Wiseman and Rob Gillies
The Associated Press
August 26, 2026
Category: Business & Politics
Region: Canada, United States

WASHINGTON — The US and Canada have ramped up their trade war, hitting each other with steep new tit-for-tat tariffs. Despite the bravado coming from both sides of the border, though, analysts suspect the longtime allies will eventually strike a deal to end a conflict neither really wants. The prospects for compromise looked bleak Tuesday, with Canadian Prime Minister Carney reacting to new 50% US tariffs by responding in kind on about $20 billion worth of American imports. …With the breakdown threatening to harm one of the world’s largest trading relationships and clouding efforts to renew the US-Mexico-Canada Agreement, experts cautioned that there’s still time to pull back from the brink. They’ve done it before. “If there is political will, there is an off ramp,’’ said former US trade negotiator Wendy Cutler.

In related coverage in:

Read More