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“BREAKING: Ontario is issuing a 25% export tax on electricity to the US, per WSJ. This impacts 1.5 million homes in Minnesota, Michigan, and New York, in retaliation to President Trump’s tariffs.
China also hit back, targeting the US agricultural sector with fresh levies.
Concerns about higher tariffs, pushing up US import prices, and driving inflationary pressures weighed on risk sentiment. Higher inflation may curb consumer spending, potentially delaying Fed rate cuts. The odds of a US recession in 2025 jumped to 43%, the highest since November, amid an escalation in the trade war.
Meanwhile, US Commerce Secretary Lutnick provided some relief, reportedly saying that Trump plans to roll back tariffs on Canada and Mexico. Trump had initially threatened an immediate increase in tariffs on Canada in response to its countermeasures.
Concerns about the US economy and tariff developments set the tone for the Asian session on Wednesday, March 5.
Beijing Sets 2025 Economic Growth Target
The third session of the 14th National People’s Congress entered its second day against the backdrop of rising US-China trade tensions. Beijing announced a 2025 economic growth target of around 5% and pledged additional fiscal support to counter deflationary pressures and the effects of higher US tariffs. CN Wire reported key measures, including:
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