India Business Journal - US President Trump’s duties on imports from Canada, China and Mexico take effect

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US President Trump’s duties on imports from Canada, China and Mexico take effect

IBJ Bureau
Mar 05, 2025

US President Donald Trump’s new 25 per cent tariffs on imports from Mexico and Canada took effect on Tuesday, along with a doubling of duties on Chinese goods to 20 per cent. The US action sparked trade wars that could slam economic growth and lift prices for Americans still smarting from years of high inflation.

The tariff actions, which can upend nearly $2.2 trillion in annual US trade with its top-three trading partners, went live at 12:01 am. Mr Trump declared that all three countries had failed to do enough to stem the flow of the deadly fentanyl opioid and its precursor chemicals into the US.

Mr Trump’s new tariffs helped push Wall Street’s main stock indexes lower for the second day in a row in early trade, with the tech-heavy Nasdaq Composite index dropping by more than 10 per cent from its all-time high on December 16. Automakers, homebuilders, retailers and other tariff-sensitive stocks all took hits.

The losses followed steep drops in Asian and European shares, which helped push the safe-haven 10-year US Treasury yield to its lowest level since October. The Canadian dollar and Mexican peso weakened against the greenback.

China responded immediately, announcing additional tariffs of 10 to 15 per cent on certain US imports from March 10 and a series of new export restrictions for designated US entities. Later it said that it had raised complaints about the new measures with the World Trade Organization (WTO).

Canada and Mexico, which have enjoyed a virtually tariff-free trading relationship with the US for three decades, were poised to immediately retaliate.