Canada is reportedly to announce retaliatory tariffs against the US on Tuesday, according to an AP source

Retaliation of this kind follows a familiar sequence: an initial US tariff action, a list-based response from the affected partner aimed at politically sensitive US exports, then a negotiating window in which the measures are delayed, scaled back, or taken as the starting point for talks. Past episodes have tended to see the headline move concentrated in the bilateral FX pair, with the partner currency weakening on the escalation risk premium, alongside pressure on the equity sectors with the deepest cross-border supply chains, autos and industrials chief among them. The detail that matters in the announcement is the scope and structure of the list: a targeted, dollar-for-dollar response reads as negotiating posture, while broad or escalating coverage signals a longer dispute. The sourcing is a single-agency report, so confirmation from Ottawa directly is the first tell, followed by any US counter-response and whether carve-outs or exemptions appear. The BoC angle is secondary but real, since a sustained tariff exchange feeds into growth and inflation assumptions on both sides of the border.