Tariff-driven inflation could raise interest rates for us all

Trump 2.0 is different.

- JAMES MOORE

He is better organised and has his people in place to deliver his agenda including all his most destructive impulses. Hence the imposition of tariffs on Canada and Mexico (25 per cent) after a month’s suspension, with an additional levy on China (bringing the total to 20 per cent).

These are paid by importers at ports and the border. The theory is that levies protect domestic industries. In practice, it’s not so simple. Is it ever? Let’s take Canada. The duties imposed on its produce don’t just hit its most famous export – the maple syrup represented on the famous flag – they also apply to energy.

Canada supplies roughly 58 per cent of energy-hungry America’s hydrocarbon imports and 60 per cent of its crude oil imports. Canada is a good supplier for the US because it is next door and is (was) a reliable ally. The inevitable result of this is that America’s energy will become more expensive.