Canada and U.S. officially in trade war as tariffs take effect

U.S. tariffs on Canada are now in effect as of 12:01 a.m. this morning.

This means that all Canadian goods crossing into the United States will now be subject to 25 per cent tariffs. The only exception is energy and critical minerals which are subject to 10 per cent tariffs.

With Canada now in a trade war with its closest trading partner a number of announcements and counter-measures are expected today. In an appearance on NBC News on Monday afternoon, Ontario Premier Doug Ford warned that there would be a strong response.

This will likely include immediate removal of U.S. alcohol products from the LCBO, the cancelation of contracts with Starlink and other American companies as well as a number of other actions restricting the flow of supply of products over the border.

Canada, for its part, has already promised to retaliate. Counter-tariffs will immediately go into effect on $30 billion of U.S. goods. An additional $125 billion in goods will be subject to tariffs within three weeks.

A full list of products subject to Canadian tariffs was previously detailed by the government. 

The Bank of Canada has warned that the trade war will have a severe impact on the economy.

In a statement on Monday, Prime Minister Justin Trudeau said "there is no justification for these actions" when asked about the U.S. tariffs.

Trudeau is expected to release a more detailed response today.