Consumers Already Feeling the Pinch; Prices Rising on Everyday Items

Thunder Bay – NEWS — In a dramatic escalation of trade tensions, U.S. President Donald Trump signed an Executive Order on August 1, 2025, increasing tariff rates on certain Canadian imports from 25% to 35%. The hike applies specifically to goods not covered under the USMCA, while items that meet the trade agreement’s criteria remain exempt. Canada was notably excluded from special delays granted to other partners like Mexico and the EU .

Trump justified the tariff surge by complaining that Canada has failed to collaborate effectively on stopping fentanyl smuggling and illegal border crossings into the U.S.. Canada contributes just about 1% of fentanyl entering the U.S., a fact stressed by Prime Minister Mark Carney, who called the move “disappointing”.

Canada’s Trade Response

Earlier in the year, Canada retaliated with 25% tariffs on tens of billions in U.S. exports, targeting goods including dairy, machinery, and alcohol. However, Canada has signaled it is unlikely to escalate retaliation significantly, citing its much smaller economic footprint relative to the U.S.. Trade Minister Dominic LeBlanc stated: “We’re prepared to stick around and do the work needed” on negotiations despite the setback .

What’s Affected: Prices on the Rise

Experts warn consumers are already feeling the impact:

Fridges & Appliances

• Counter‑tariffs on U.S.-made washers, dryers, and HVAC units, combined with Trump’s 50% tariffs on U.S. steel and aluminum, have driven up costs. Refrigerators and freezers rose about 2%, while laundry appliances jumped 4.5% year-over-year in June.

Automotive Sector

• Vehicles can cross national borders multiple times during assembly. Tariffs on cars not compliant with USMCA and on steel have compelled manufacturers to raise prices. June saw new car prices increase more than 5%, with used vehicle prices climbing as buyers delay new purchases according to The Wall Street Journal.

Groceries & Packaged Goods

• Canadian counter-tariffs on popular U.S. food imports like peanut butter, ketchup, soup, and canned fruit have driven up costs by 7–8%. Even grocery chains like Loblaw now label over 7,500 tariff-affected items due to lax sales.

Clothing & Footwear

• Prices rose 2%, a rare uptick after decades of decline. While clothing isn’t directly tariffed, broader global trade tensions are pressuring costs .

Housing & Construction

• Tariffs on imported steel, aluminum, glass, flooring, and shingles are sparking material cost increases. Developers report delays and supply chain shifts as they attempt to source materials locally. CMHC forecasts show potential declines in housing starts by 8–26% in provinces like Ontario due to stalled construction.

🧭 What It Means for Canada

• Economic Strain: The move weakens Canadian exporters and complicates trade dynamics just ahead of scheduled USMCA reviews for 2026.

• Consumer Impact: Everyday goods from appliances to food are more expensive. Inflationary pressures are mounting.

• Political Fallout: While Canada retaliated earlier in 2025, leaders are divided on whether further escalation would harm domestic resilience .

Canada finds itself caught in the crosshairs of U.S. trade policy shifts that extend far beyond economics, dipping into political brinkmanship and border disagreements. The full fallout—on jobs, prices, and industrial output—will unfold in the weeks ahead.