US Commerce Secretary Howard Lutnick has hinted that President Donald Trump is likely to announce a deal on Wednesday to ease tariffs on Canada and Mexico, amid escalating trade tensions.
Speaking to Fox Business Network, Lutnick said both Canadian and Mexican officials had been in discussions throughout the day, seeking to demonstrate stronger measures to curb the flow of fentanyl into the US. “Both the Canadians and Mexicans were on the phone with me all day today trying to show that they’ll do better,” he noted.
However, Canada’s Minister of Foreign Affairs, Mélanie Joly, pushed back on the claim, telling BBC’s Newsnight that her office had not been contacted about the proposed tariff reduction plan.
The dispute escalated after Washington imposed a 25% tariff on imports from Canada and Mexico, prompting swift retaliatory levies from both countries. Canadian Prime Minister Justin Trudeau slammed Trump’s move, calling it “a very dumb thing to do,” and vowed to wage a “relentless fight” to protect Canada’s economy.
In response, Trump doubled down on his position, warning on his Truth Social platform: “Please explain to Governor Trudeau, of Canada, that when he puts on a Retaliatory Tariff on the U.S., our Reciprocal Tariff will immediately increase by a like amount!”
Despite the tensions, Lutnick indicated that the US is seeking a compromise. “I think [Trump’s] going to figure out, ‘you do more, and I’ll meet you in the middle some way.’ And we’re probably going to be announcing that tomorrow,” he stated, clarifying that the tariffs would likely be reduced rather than merely paused.
Meanwhile, sources told the Globe and Mail that Lutnick had spoken with Ontario Premier Doug Ford, reportedly warning against Canadian retaliation and what was perceived as personal attacks on Trump.
With both sides digging in, all eyes are now on Wednesday’s expected announcement to see if a breakthrough can be reached or if the tariff war will intensify further.
