Canada inflation ticks up as Carney says US trade talks ‘intensive’

MONTREAL: Canada’s annual inflation rate rose to 2.4 per cent in September, data showed Tuesday (Oct 21), as Prime Minister Mark Carney said Ottawa was in “intensive” talks with Washington to reduce tariffs that have contributed to higher consumer prices.

Speaking in Ottawa, Mr Carney was asked about a report in The Globe and Mail saying that a trade deal with US President Donald Trump in three key sectors, steel, aluminium and energy, could be ready to sign within days.

“We’ll see,” Mr Carney told reporters. “We’re in intensive negotiations.”

He said both sides were seeking ways to reduce barriers that have affected supply chains and manufacturing costs. The prime minister added that discussions were continuing in good faith, but that “some challenges remain”.

TARIFFS STRAIN TRADE TIES

About 85 per cent of cross-border trade remains tariff-free under the existing North American trade pact, the United States–Mexico–Canada Agreement (USMCA).

However, Mr Trump’s global sectoral tariffs, particularly on steel, aluminium and autos, have hit Canada hard, causing job losses and squeezing manufacturers.

Canada is a major supplier of steel and aluminium to US industries, and Mr Carney has previously expressed optimism about a breakthrough in those areas. But he also noted that Mr Trump remains committed to imposing tariffs on foreign-made vehicles, a move that could seriously affect Canada’s auto sector given the integrated nature of North American car production.

Trade experts say any deal to ease tensions could boost business confidence ahead of the USMCA review scheduled for 2026, but they warn that political factors in Washington could delay an agreement until after the US election cycle gains momentum next year.