The United States and Canada are still in a trade fight. US President Donald Trump started many new taxes on goods from other countries after he returned to office in January 2025. The US put taxes on Canadian steel, aluminium, wood and cars. On 22 August 2026, it added a 50% tax on about C$28 billion of Canadian goods. Canada answered with taxes on the same value of US goods from 8 September.

The taxes have hurt workers and companies in both countries. Ontario and Quebec have suffered the most in Canada because they make many cars and metal products. Canada lost about 55,000 factory jobs from January 2025 to January 2026. One expert says Canada could lose 90,000 jobs if the new US taxes continue. In the US, Ohio, Illinois and Pennsylvania may feel the strongest effects from Canada’s taxes. US families may also pay about $840 more this year because goods cost more.

Canada still sends more than 70% of its exports to the US, but some Canadian companies now sell more goods to Europe and other places. Prime Minister Mark Carney wants Canada to double its exports to countries outside the US in the next ten years. Canada’s economy grew by 3.3% in the second quarter of 2026, so a serious fall has not started yet. However, more jobs may disappear and prices may rise if the two countries do not make a new agreement.