The trade battle between the U.S. and Canada is prompting economists to predict the Bank of Canada will lower its policy interest rate to two per cent this year, almost as low as before the COVID-19 pandemic.

The Fed won't lower rates at its policy meeting next week, but could deliver the first of a set of rapid-fire reductions in borrowing costs in June.

The tariff actions, which could upend nearly $2.2 trillion in two-way annual U.S. trade, went live hours after Trump declared that all three countries had failed to do enough to stem the flow of the deadly fentanyl opioid.

The stakes are existential for the administration, with the potential to cost Republicans dearly in next year's midterms.

U.S. President Donald Trump's trade war with China will give Brazilian agricultural exporters an opportunity to take an even bigger share of the Chinese market at the expense of American farmers, but it could also fuel already high food inflation in Brazil.

Gold prices rose on Tuesday, supported by safe-haven flows as trade war concerns sapped risk sentiment across wider markets, while attention was on U.S. inflation data, as per a report. Spot gold climbed 0.

Canada’s next prime minister has already helped run two Group of Seven economies in crisis and now will try to steer Canada through a looming trade war brought by U.S. President Donald Trump, a threat of annexation and an expected federal election.