The U.S. has officially imposed 25% tariffs on imports from Canada and Mexico, alongside a doubling of tariffs on Chinese goods to 20%, triggering sharp stock market declines and setting the stage for retaliatory measures from key trade partners.

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Despite speculation of a last-minute reversal, President Donald Trump confirmed the tariffs would proceed, affecting over $918 billion in imports from Canada and Mexico. In response, Canada has immediately levied 25% tariffs on $20 billion worth of U.S. goods, with additional measures on $86 billion in imports set for the coming weeks. Mexico has yet to announce its response but has warned of a contingency plan in place. Meanwhile, China has vowed to impose 10-15% tariffs on U.S. agricultural products next week.

The S&P 500 plunged 1.8%, its worst day since December, amid fears of rising costs for U.S. consumers and businesses. Experts warn that increased tariffs will drive up vehicle prices, with pickup trucks potentially seeing a $10,000 price hike due to disrupted supply chains. Logistics firms also anticipate shipping slowdowns, with manufacturers scrambling to reassess sourcing strategies.

Further tariff escalations could be on the horizon, with Trump signaling potential 25% duties on EU exports, claiming the bloc had been “screwing the U.S. for years.”