While stock markets dismissed the looming threats of Trump Tariffs in 2025, trade partners are concerned. Officials from Canada, Mexico, and China said that a trade war would hurt everyone involved.
Trump is threatening to impose a 25% tariff on Canadian and Mexican imports when he takes power. This includes oil exports. U.S. energy firms fell on the news. On Tuesday, Exxon Mobil (XOM) fell while Chevron (CVX) and ConocoPhillips (COP) rose slightly.
Mexico’s President, Claudia Sheinbaum, said that tariffs would put the country’s common businesses at risk. In Canada, Deputy Governor Rhys Mendes said that the events unfolding in the U.S. would have an impact on both economies.
In China, a spokesperson said that no one would win a trade or tariff war.
In response to the threats, Canada’s dollar, the Loonie (FXC), lost 0.63 percent to close at $69.51. This is a level that re-tests the November 15, 2024 low. The currency last traded at an intraday low of around $67.50 during the Covid pandemic in 2000. Before that, the currency traded at around $68.00 briefly in January 2016.
Ford Motor (F) and General Motors (GM) traded lower on the day. GM stock lost 8.99%. The stock is unlikely to hold and break out above the $60 - $65 peak reached in 2021-2022. GM needs the U.S. to have an open trade policy to thrive.
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