Economic growth in Canada has slowed greatly last month, which raised new concerns about the influence of Trump’s tariff. On Friday, Trump said he spoke with Carney and plans to hold a meeting to negotiate a “new economic and security relationship” after the upcoming elections in Canada.
Canada statistics On Friday, the gross domestic product did not grow in February. This flat performance follows a strong increase of 0.4 % in January, which was the most powerful monthly pace to expand since April of the previous year. Economists expected healthy growth at the beginning of 2025, and the January height appears to confirm these expectations.
Many analysts say that if there is no growth in March, the annual rate for the first quarter will reach 2.1 %. This figure is slightly higher than the 2 % higher expectations reconnaissance. While this result will go beyond those expectations, it will remain weaker than the 2.6 % pace registered in the fourth quarter.
Canada Bank is scheduled to make its next political decision on April 16. On the one hand, the generally weaker growth exerts the low pressure on inflation, which may justify the reduction of prices. On the other hand, high tariffs raise import costs and can pay consumer prices up.
The ruler Tif McLim indicated last week that the risk of trade war can create pressure for inflation, limiting the Central Bank room to reduce interest rates. He said that the bank must ensure that Canadians believe that price pressures will settle in the long run despite the high prices resulting from the customs tariff.
The uncertainty about the definitions was a strong impact earlier in the year. In January, many exporters and importers climbed their activities to advance the duties of Washington threatening to impose it. This increase helped strengthen the monthly monthly GDP for January. But by February, the effect of these efforts appears to have faded.
According to Statistics Canada, manufacturing and financing sectors still have some gains in that month, but real estate, oil, gas and retail trade still suffered from declines. The agency added that the initial retail data for February indicates that consumers have tightened their spending for the second month in a row, noting that family consumption is low.
Trump and Carne’s plans to hold a meeting after the Election Day in Canada
Prime Minister Mark Carney, who took office on March 14, spoke with President Trump on the phone last week. On the social media platform, Trump books On Friday, “It was a very fruitful invitation, and we agree on many things, and we will meet immediately after the upcoming elections in Canada to work on the elements of politics, business and all other factors, which will eventually end both the United States of America and Canada.”
Carney a statement On the conversation, stressing that he and President Trump will start “comprehensive negotiations” once the elections are over.
At the same time, Carney repeat Canada will continue to impose two counter opportunities, especially once the United States applies its new tour of import taxes on April 2. Trump has settled this date “Liberation Day” and plans to reveal the “mutual tariff” that aims at multiple commercial partners.
The national elections in Canada are scheduled to be held on April 28, and Carne in a narrow race against conservative leader Pierre Boelifer. Federal elections have turned into a competition on the best ways to deal with American pressure. The liberal Carney Party has a narrow difference in some opinion polls, but it is still a close competition.
The Carney government criticizes the latest movements of the United States, including a 25 % tariff on cars and auto parts. On Wednesday, Trump announced that the new car tariff will enter into force next week, describing them as a large part of his plan to protect our jobs.
Carney returned back, saying that the procedure is a “direct attack” on Canada’s auto workers and violated the USMCA trade agreement that was negotiated during the previous Trump term.
Moreover, Trump’s proposal that Canada can become the 51st American state has increased only political tensions. Canada has already placed a 25 % revenge tariff on about $ 60 billion Canadian dollars ($ 41.9 billion) in goods from the United States, and it threatens to impose duties on another $ 95 billion if the White House does not decline.
Poilievre leader Poilievre adopted the slogan “Canada first”, accusing the liberals of leaving the country vulnerable to the American aggression by not focusing on making the economy more independent. Carney’s meters that the United States is “no longer a reliable partner”, and believes that Canada needs a new approach to relations with its neighbor. He said: “The old relationship that we had with the United States, based on deepening integration between our economies, security cooperation and military cooperation.”
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