Duty Calls: Canada & US Trade Report, July 2026 (PDF)

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关税来袭：加拿大与美国贸易报告，2026年7月（PDF）

Scotiabank Economics09/03/2026updated 10/17/2026

Citable research brief

Core conclusion · Tlines extraction

Scotiabank Economics reports that Canadian exports fell 2.3% in July 2026, ending five consecutive monthly gains, largely due to volatile gold and oil prices which have since rebounded. Exports to the US declined 6.6% m/m but rose 11% y/y, while the share of Canadian exports to the US fell to 66% from 76% in 2024, as non-US markets (especially Europe) grew faster. Canada's effective tariff rate increased to 4.3% with new US tariffs, potentially rising further with retaliation. US tariffs are adding inflationary pressure, with cumulative impact on core PCE estimated at 0.7%, clouding the Fed's rate cut outlook. The baseline remains that Canada will secure a competitive ETR and tariff-free access to the US, but the path is volatile with potential for further escalations or a deal in coming months.

Institution: Scotiabank Economics
Published: 09/03/2026
Research topic: Not explicitly stated
Time horizon: Not explicitly stated

Key arguments

Canadian exports fell 2.3% m/m in July 2026, driven by declines in gold and oil due to softer prices, but other categories rose 0.6%.
Export volumes fell 1.5% m/m, suggesting weaker momentum into Q3, with further headwinds from new US tariffs in August.
Canada's effective tariff rate on exports rose to 4.3% following new US tariffs, and could increase further with retaliation.
US tariffs are adding inflationary pressures, with cumulative impact on core PCE around 0.7%, affecting interest rate cut expectations.
The share of Canadian exports to the US is trending lower at 66% in July 2026, from 76% average in 2024, due to faster growth in non-US markets.
Baseline remains that Canada will secure a competitive ETR and tariff-free access to the US, but the path will be volatile with potential for further escalations or a deal.

Key numbers

Canadian exports m/m %: -2.3
Canadian imports m/m %: 2.2
US exports m/m %: -2.1
US imports m/m %: 2.8
US trade deficit: US$89 bn
Canada's effective tariff rate: 4.3%
Cumulative impact on US core PCE: 0.7%
Share of Canadian exports to US: 66%

Main risks

Further tit-for-tat tariff escalations in the coming months.
Canada's retaliatory tariffs could trigger US retaliation, increasing uncertainty.
Tariff-induced inflation could limit Fed rate cuts, affecting growth.
Volatile gold and oil prices could mask underlying sector weaknesses.

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