US and Canada Trade War Escalates, But Deal Remains Possible

The U.S. and Canada have escalated their trade war with new tit-for-tat tariffs, though analysts predict a deal may eventually be reached to end the conflict. Canadian Prime Minister Mark Carney responded to 50% U.S. tariffs on certain goods by targeting $20 billion in American imports, including steel and dairy. Ontario's premier threatened to cut electricity shipments, while Trump warned of auto tariffs. Talks collapsed Friday, but tariffs cover only 5% of Canadian exports, and retaliatory measures don't take effect until Sept. 8. Both sides face economic and political pressure to compromise.