{"id":15987,"date":"2025-07-04T15:01:15","date_gmt":"2025-07-04T15:01:15","guid":{"rendered":"https:\/\/www.rbc.com\/en\/?post_type=rbc_tl&p=15987\/"},"modified":"2025-07-04T15:01:16","modified_gmt":"2025-07-04T15:01:16","slug":"trade-zone-waiting-for-9th-of-july-fireworks-or-a-fizzle-out","status":"publish","type":"rbc_tl","link":"https:\/\/www.rbc.com\/en\/thought-leadership\/the-trade-hub\/trade-zone-waiting-for-9th-of-july-fireworks-or-a-fizzle-out\/","title":{"rendered":"Trade Zone: Waiting for 9th of July fireworks\u2014or a fizzle out"},"content":{"rendered":"\n
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In this week\u2019s edition: <\/strong>Prime Minister Mark Carney has marked his own red circle in the calendar: July 21; and what the latest trade data tells us about Canada\u2019s export diversification strategy<\/p>\n<\/div>\n<\/section>\n\n\n\n

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After Independence Day comes Liberation Day 2.0<\/h2>\n\n\n\n

Happy 249th<\/sup> Birthday, America! Enjoy the fireworks over the long weekend, but markets are bracing for the more consequential American spectacle on July 9 when the 90-day pause on Liberation Day tariffs comes to an end. Will there be more pyrotechnics or a fizzle out?

The White House\u2019s \u201c90 deals in 90 days\u201d ambition has turned into two American humble-pie, kinda<\/em> partial deals with the U.K. and China, and another with Vietnam this week.
Will President Donald Trump extend the ceasefire, or will he launch a fresh volley of tariffs against allies like Japan, the EU and Canada?

\u201cAbout 10 to 12 countries are very close to a deal,\u201d said Joseph Lavorgna, an advisor to U.S. Treasury Secretary Scott Bessent<\/a>, with another 20 negotiating in good faith. \u201cAnd Secretary Bassett highlighted that many deals could be done by Labor Day.\u201d Is that a tell that the administration is looking to push past July 9? Who knows.

While Canada has an eye on that date, Prime Minister Carney has marked his own red circle in the calendar: the July 21<\/a> deadline to conclude a security and economic deal with the U.S. To facilitate talks, Ottawa scrapped its digital services tax on Big Tech, which was an irritant to President Trump. Canada is now back in the \u201cfront of the line\u201d in trade negotiations, assured Pete Hoekstra, U.S. Ambassador to Canada.

Strategically, it\u2019s an open question if Canada is better off rushing to negotiate a bilateral deal with the U.S. or defer until the autumn. In such serial negotiations, first movers often set the pattern, so there may be an advantage to rush a deal with Trump. On the other hand, the president desperately wants the Federal Reserve to cut interest rates<\/a>, which would lower interest payments on America\u2019s ballooning public debt, lower debt-servicing costs and galvanize economic activity. Jerome Powell, Chairman of the Federal Reserve, is holding firm on rate cuts until the trade turmoil settles down<\/a>. Come autumn, we will be in a countdown to midterm elections, which will put pressure on Trump to rev up America\u2019s economic engine. Canada may be better off waiting until public pressure on Trump mounts. That is, if its own trade and economic data holds up.<\/p>\n\n\n\n

While Trump recently said his administration has \u201call the cards\u201d in its negotiations with Ottawa, Carney has a few aces up his sleeve, too.<\/p>\n\n\n\n