Updated April 11, 2025 @ 5:49pm
Prime Minister Mark Carney said there are signs the global and Canadian economies are slowing as U.S. President Donald Trump's trade war escalated again Friday, with China announcing it will push up retaliatory tariffs to 125 per cent.
"In the last week there have been a lot of developments in terms of U.S. tariffs policy, reactions from others including China. It really marked tightening in financial conditions ... the initial signs of slowing in the global economy," Carney said.
"Impacts that we are starting to see ... unfortunately in the Canadian economy, particularly in the Canadian labour market."
The Liberal leader took a day off the federal election campaign trail Friday to convene the cabinet committee on Canada-U.S. relations after a raucous week of White House tariff manoeuvres.
Markets have been in turmoil since Trump brought his trade war to the world, only to drastically change course. He paused his so-called "reciprocal" tariffs Wednesday shortly after putting the duties in place.
Trump kept in place a universal 10 per cent tariff, as well as 25 per cent duties on steel, aluminum and automobile imports to the United States. The president also pushed tariffs on Chinese imports to 145 per cent.
American tariffs on Canada did not change.
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Prices for longer-term U.S. Treasury bonds fell Friday — moving their yields higher — while the price of gold rose, sending worrying signs to market observers.
White House press secretary Karoline Leavitt said Americans should "trust in Trump" after University of Michigan data showed U.S. consumer sentiment plunged this month. Leavitt said past presidents accepted "the failed status quo" on trade but "that's not who this president is."
Trump's administration has said more than 75 countries are looking to make a deal before the 90-day pause on reciprocal tariffs is set to lift. Leavitt said countries need America to survive "and the president is using that leverage to our advantage."
The Canada-U.S.-Mexico Agreement on trade was negotiated during the first Trump administration to replace the North American Free Trade Agreement. At the time, Trump hailed the agreement. Experts say his tariffs are undermining the continental trade pact.
Carney, who spoke with Trump by phone late last month, said the president agreed to begin negotiations on a new economic and security agreement after Canada's election. Carney said he left instructions with officials to prepare the next government for negotiations with the Trump administration following the April 28 vote.
The Canadian auto sector faces ongoing uncertainty from Trump's inconsistent tariff agenda but GM Canada cited lower-than-expected demand for its electric delivery vehicles as the driving force behind the decision to temporarily halt production at its CAMI plan in Ingersoll, Ont.
GM Canada spokeswoman Jennifer Wright said in a statement that the company remains committed to the future of the BrightDrop electric delivery van and the CAMI plant, and will support workers through the transition.
Unifor, which represents more than 1,200 workers at the plant, said temporary layoffs will start on April 14.
The union said Trump's tariffs on Canadian-made vehicles have sent shockwaves through the industry. The president's plan to weaken electric vehicle mandates and roll back emission standards has also caused uncertainty.
"Trump's shortsighted tariffs and rejection of EV technology is disrupting investment and freezing future order projections," Unifor national president Lana Payne said in a news release. "This is creating an opening for China and other foreign automakers to dominate the global EV market while the North America industry risks falling behind."
Conservative Leader Pierre Poilievre said he spoke with the Unifor Local 88's plant chairperson Friday morning "and expressed my commitment to protect Canadian auto workers."
"We will keep them working, so they can keep their jobs as we fight through this mess," Poilievre said in a news release. "A Conservative government will push hard to put an end to these tariffs and get a quick but fair deal that protects our sovereignty and our economy."
— With files from Kelly Geraldine Malone in Washington
This report by The Canadian Press was first published April 11, 2025.
