35% tariff on Canada still in the cards, Lutnick says
Lutnick said in an interview on Fox Business Network's "Kudlow" that Canadian Prime Minister Mark Carney could still convince Trump to back down.
"If he makes that call, and if he starts turning on the charm, and if he takes off his retaliation ... and stops the silliness, maybe the president will let it down a bit," Lutnick said. "But right now, 35%, that letter he sent, is surely in the cards."
Trump sent a letter to Carney in July saying the U.S. would impose a 35% tariff on Canadian goods as of Aug. 1. The two sides have been working on negotiating a trade deal by that deadline, but Trump said last week they may not be able to reach a negotiated deal, suggesting the unilateral tariff rate could be imposed.
Earlier this week, Carney said talks were at an intense phase, while reiterating that a deal that would remove all U.S. tariffs was unlikely.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Reuters
12 minutes ago
- Reuters
Japan's Ishiba signals talks with Trump for early cut to US auto tariff
TOKYO, Aug 4 (Reuters) - Japanese Prime Minister Shigeru Ishiba said on Monday he will not hesitate to hold talks with President Donald Trump to ensure an agreed cut to U.S. automobile tariffs is implemented soon. In a parliament session on Monday, Ishiba drew criticism from some opposition lawmakers for not having signed an official document with the U.S. in clinching a trade deal last month. "Creating a document could have delayed the timing of tariff cuts. That was our biggest fear," Ishiba said, defending Japan's decision to agree on a deal without creating an official document with the U.S. "He is not a typical counterpart and could overturn rules," Ishiba said on Trump's negotiating style. Ishiba said he had "absolutely no hesitation" to hold talks with Trump to have Washington execute the tariff cut soon, though he declined to comment on when such talks could take place. "Both countries will begin executing what was agreed upon, which is harder than agreeing on a deal," Ishiba said, signaling his intention to stay on as premier to see through the process. Ishiba is under pressure from within his ruling Liberal Democratic Party to step down as prime minister to take responsibility for the party's huge defeat in last month's upper-house election. Japan's trade deal struck with Trump last month lowers U.S. tariffs on imports of goods including automobiles, easing the pain for the export-reliant economy. But there is no clarity on when U.S. tariffs for automobiles and auto parts will be cut to 15% from the current 25%, clouding the outlook for Japan's fragile recovery. In the same parliament session, Japan's top trade negotiator, Ryosei Akazawa, said it was hard to say how soon the U.S. could actually implement automobile tariffs, though he added it took "more than a month" in the case of Britain.
Reuters
14 minutes ago
- Reuters
Shares get a lift in Asia as lower US rates are baked in
SYDNEY, Aug 4 (Reuters) - Share markets found some much needed support in Asia on Monday as the heightened prospect of lower borrowing costs helped soothe concerns about the U.S. economy, though the long-term credibility of U.S. policy remained in doubt. A buy-the-dip mentality led to a bounce in Wall Street and European stock futures, and allowed the dollar to stabilise after Friday's U.S. payrolls-induced retreat. Treasuries ran into some profit-taking after their huge gains, but fund futures still imply an 85% chance the Federal Reserve will cut rates in September and ease by 100 basis points or more by this time next year. The prospect of a shift in rates was the only silver lining to a dire payrolls report in which downward revisions left the three-month average of jobs growth at 35,000 from 231,000 at the start of the year. "The report brings payroll growth closer in line with big data indicators of job gains and the broader growth dataset, both of which have slowed significantly in recent months," said analysts at Goldman Sachs. "Taken together, the economic data confirm our view that the U.S. economy is growing at a below-potential pace." Neither did the reaction of President Donald Trump instil confidence, as the firing of the head of Labor Statistics threatened the credibility of U.S. economic data. Likewise, news that Trump would get to fill a governorship position at the Federal Reserve early added to worries about the politicisation of interest rate policy. Analysts assume the appointee will be loyal to Trump alone, though the president did grudgingly concede that Fed Chair Jerome Powell would probably see out his term. "It opens the prospect of broader support on the Fed Board for lower rates sooner rather than later," said Ray Attrill, head of FX research at NAB. "Fed credibility, and the veracity of the statistics on which they base their policy decisions, are both now under the spotlight." Markets have essentially already eased for the Fed, with two-year Treasury yields down almost 25 basis points on Friday in the biggest one-day drop since August last year. The drop in global yields seemed to help equities, with S&P 500 futures and Nasdaq futures both bouncing 0.4%. EUROSTOXX 50 futures gained 0.6%, while FTSE futures rose 0.5% and DAX futures 0.4%. MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS), opens new tab firmed 0.7%, aided by a 1.1% rally in South Korean (.KS11), opens new tab stocks. Japan's Nikkei (.N22%), opens new tab fell 1.4%, in part weighed by Friday's rebound in the yen, while Chinese blue chips were flat. Wall Street has taken comfort in an upbeat results season. About two-thirds of S&P 500 companies have reported, and 63% have beaten forecasts. Earnings growth is estimated at 9.8%, up from 5.8% at the start of July. Companies reporting this week include Disney (DIS.N), opens new tab, McDonald's (MCD.N), opens new tab, Caterpillar (CAT.N), opens new tab and some of the large pharmaceutical groups. The dismal U.S. jobs data did put a dent in the dollar's crown of exceptionalism, snuffing out what had been a promising rally for the currency. The dollar was a shade firmer at 147.79 yen , having shed an eye-watering 2.3% on Friday, while the euro held at $1.1574 after bouncing 1.5% on Friday. The dollar index was pinned at 98.801 , having tumbled from last week's top of 100.250. Sterling was restrained at $1.3281 as markets are 87% priced for the Bank of England to cut rates by a quarter point at a meeting on Thursday. The BoE board is expected to remain split on easing, while markets still favour two further cuts by the middle of next year. In commodity markets, gold was little changed at $3,357 an ounce , having climbed more than 2% on Friday. Oil prices extended their latest slide as OPEC+ agreed to another large rise in output for September, which completely reverses last year's cuts of 2.2 million barrels per day. Brent futures dropped 0.2% to $69.52 a barrel, while U.S. crude futures fell 0.1% to $67.24 per barrel.
Reuters
14 minutes ago
- Reuters
Dollar finds footing after US jobs drubbing
SINGAPORE, Aug 4 (Reuters) - A battered dollar found some support on Monday after a dismal U.S. jobs report and President Donald Trump's firing of a top labour official stunned investors and led them to ramp up bets of imminent Federal Reserve rate cuts. Data on Friday showed U.S. employment growth undershot expectations in July while the nonfarm payrolls count for the prior two months was revised down by a massive 258,000 jobs, suggesting a sharp deterioration in labour market conditions. Adding to headwinds for markets, Trump fired Bureau of Labor Statistics (BLS) Commissioner Erika McEntarfer the same day, accusing her of faking the jobs numbers. An unexpected resignation by Fed Governor Adriana Kugler also opened the door for Trump to make an imprint on the central bank much earlier than anticipated. Trump has been at loggerheads with the Fed for not lowering interest rates sooner. The barrage of developments dealt a one-two punch to the dollar, which sank more than 2% against the yen and roughly 1.5% against the euro on Friday. The greenback recovered some of its losses against the Japanese currency on Monday, last trading 0.2% higher at 147.67 yen . Still, it was down about 3 yen from its peak on Friday. The euro fell 0.06% to $1.1579 , while sterling was little changed at $1.3281. Trump said on Sunday he will announce a candidate to fill an open position at the Fed and a new BLS head in the next few days. Against a basket of currencies, the dollar edged up 0.1% to 98.75, after sliding more than 1% on Friday. "Market reactions to Friday night's events were swift and decisive," said Tony Sycamore, a market analyst at IG. "Equities and the U.S. dollar tumbled, along with yields." The two-year Treasury yield fell to a three-month low of 3.6590% on Monday as traders heavily scaled up bets of a Fed cut in September, while the benchmark 10-year yield strayed not too far from a one-month low at 4.2493%. Markets are now pricing in a more than 90% chance the Fed will ease rates next month owing to the weaker-than-expected jobs data, with just under 60 basis points worth of cuts expected by December. "We pull forward our baseline call for a 25 bps cut from the FOMC to September," said David Doyle, head of economics at Macquarie Group. "While we don't see significant further weakness in the labour market, the results of this report are likely to shift the FOMC's assessment of the balance of risks to the outlook." In other currencies, the Australian dollar rose 0.09% to $0.64815, after rising 0.8% on Friday against a weaker greenback. The New Zealand dollar eased 0.11% to $0.59125. The Swiss franc weakened more than 0.1% to 0.8054 per dollar. Switzerland was left stunned on Friday after Trump hit the country with one of the highest tariffs in his global trade reset, with industry associations warning of tens of thousands of jobs being put at risk.
