12.02.26 - Canada tariffs rejected

A rare political signal emerged from Washington as the Republican-led US House of Representatives passed a resolution rejecting President Donald Trump’s tariffs against Canada, a core element of his economic and trade policy agenda. Several Republicans crossed party lines to support the move, highlighting growing internal resistance to the administration’s trade stance.

The resolution now heads to the Senate, which approved similar measures in the past.

Markets: in wait and see mode while European stocks moved higher with hope that tariffs could be called off.

My View: The legislative effort remains largely symbolic. The President retains veto power, making a policy reversal unlikely at this stage.

The rejection of the Canada tariffs highlights how fragile and politicized US trade policy has become. Even if the resolution is ultimately vetoed, the episode underlines the elevated uncertainty surrounding future tariff decisions, compounded by pending court rulings that could still reshape the legal framework for existing measures.

Uncertainty remains elevated. The tariff topic is far from resolved. Whether tariffs are enforced, delayed, challenged in court, or suddenly rolled back, each outcome carries market implications. Volatility around trade headlines continue.

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