Global stocks declined after U.S. President Trump announced a new 35% tariff on Canadian imports effective August 1. The European Union faced potential tariff impacts as well. Trump indicated blanket 15% or 20% tariffs on various countries. Despite the tariff announcements, market reactions were subdued, with the VIX volatility index remaining low. The Canadian dollar depreciated while the euro also lost value. Analysts suggested the market might not fully react to tariffs until solid data emerges, indicating a possible openness to negotiations by Trump.
The Canadian dollar fell after Trump issued a letter late on Thursday that said a 35% tariff rate on all imports from Canada would apply from August 1.
The U.S. president floated a blanket 15% or 20% tariff rate on other countries, a step up from the current 10% baseline rate.
The market is becoming a bit numb to these (tariff) announcements, and perhaps it's not until we see hard data showing an impact that we (will) start to see the market reacting.
Because there is so much uncertainty, there is still this idea that Trump could be open to negotiation, nothing feels 'final' still.
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