Trump’s trade war draws swift retaliation with new tariffs from Mexico, Canada, China

Trump launches trade war, imposing tariffs on Mexico, Canada, and China, causing market turmoil and global uncertainty.

President Donald Trump launched a trade war Tuesday (March 4, 2025) against America’s three biggest trading partners, drawing immediate retaliation from Mexico, Canada and China and sending financial markets into a tailspin as the U.S. faced the threat of rekindled inflation and paralyzing uncertainty for business.

Just after midnight, Mr. Trump imposed 25% taxes, or tariffs, on Mexican and Canadian imports, though he limited the levy to 10% on Canadian energy. Mr. Trump also doubled the tariff he slapped last month on Chinese products to 20%.

Beijing retaliated with tariffs of up to 15% on a wide array of U.S. farm exports. It also expanded the number of U.S. companies subject to export controls and other restrictions by about two dozen.

Canadian Prime Minister Justin Trudeau said his country would plaster tariffs on more than $100 billion of American goods over the course of 21 days.

“Today the United States launched a trade war against Canada, their closest partner and ally, their closest friend. At the same, they are talking about working positively with Russia, appeasing Vladimir Putin, a lying, murderous dictator. Make that make sense,” Mr. Trudeau said.

Later in the day, Commerce Secretary Howard Lutnick said the U.S. would likely meet Canada and Mexico “in the middle,” with an announcement coming as soon as Wednesday (March 5, 2025).

Mr. Lutnick told Fox Business News that the tariffs would not be paused, but that Mr. Trump would reach a compromise.