The Carney government is navigating a complex relationship with U.S. President Donald Trump, hoping that the contradictions in his tariff policies will lead to a favorable trade agreement. Dominic LeBlanc, the minister responsible for cross-border trade, expressed optimism during a Senate committee meeting last month. "We are confident domestic pressures will create an opportunity to come to an agreement in the interests of both economies that puts us in a better position than we are in right now," he stated.

The likelihood of rising prices in the U.S. due to import tariffs has been a concern. Recently, Trump made a significant move by lowering tariffs on various agricultural products, including beef, coffee, and bananas. This decision comes amid growing worries about the cost of living in the U.S. Since April, these goods faced tariffs of at least 10 percent, with some, like Brazilian beef and coffee, subjected to a 50 percent surcharge. The tariff reduction was welcomed by trading partners such as Argentina, Brazil, and Costa Rica.

The shift in tariff policy appears to be influenced by the emergence of affordability politics in the U.S. This trend was highlighted by the recent elections of moderate Democrats in New Jersey and Virginia, as well as the election of Zohran Mamdani as New York mayor. Trump himself seemed taken aback by the political landscape, claiming in a Fox News interview that grocery prices were down and that everything was improving. However, this assertion contradicts the reality that grocery prices have not decreased, and gas prices have remained steady at around $3 per gallon.

Despite a relatively low inflation rate of three percent in September, many consumers feel the pinch at the checkout. A recent poll indicated that 71 percent of American adults are spending more on groceries than they did a year ago. The Bureau of Labor Statistics reported significant price increases for essential items, including a 40 percent rise in ground roast coffee and an 11.5 percent increase in ground beef.

The challenges faced by importers and wholesalers, who operate on slim margins, have contributed to the rising prices. Unlike importers of durable goods, those dealing with perishable items could not stockpile inventory before tariffs were imposed. Consumer sentiment has also declined, reflecting concerns similar to those seen in June 2022 when inflation surged post-pandemic.

As Trump grapples with declining approval ratings and potential legal challenges regarding his tariff policies, experts suggest that his unilateral approach may be waning. Ian Bremmer, president of Eurasia Group, noted, "We have passed peak Trump unilateralism on the global stage."

In addition to waiting for price increases to stabilize, the Carney government has sought to negotiate sector-specific deals with Trump, particularly concerning steel, aluminum, and automobiles. Prime Minister Mark Carney previously highlighted a close relationship with Trump, but tensions arose after a controversial anti-tariff advertisement from the Ontario government. Following an apology from Carney, Trump reportedly halted negotiations and publicized the incident.

The situation is further complicated for Canada, where inflation has outpaced that of the U.S. Carney has acknowledged the need for time to transform the Canadian economy, a message aimed at managing public expectations. However, with rising living costs being the top concern for two-thirds of Canadians, the government’s approval ratings have plummeted since the April election.

While Trump’s decision to lower food tariffs may provide some relief, it remains uncertain whether prices will decrease significantly in Canada. Carney faces the challenge of convincing a restless electorate to remain patient as economic pressures continue to evolve. The current climate of immediacy and high expectations among voters adds to the difficulty of maintaining public trust amid rising costs.