Ottawa warned that Washington's imposition of 50% tariffs on Canadian goods could severely damage relations between the two countries and prompt Prime Minister Mark Carney to retaliate amid mounting domestic pressure.
Bloomberg reported that Canadian and American officials held a series of high-level meetings in recent days, seeking to contain escalating trade tensions between the two countries.
These contacts, after months of limited progress, have sparked cautious optimism in Ottawa about the possibility of reaching an interim agreement that would ease cross-border disputes.
Any anticipated settlement would represent a temporary side agreement, with the hope that it would be followed by broader talks on the future of trade relations in North America.
US President Donald Trump had threatened to impose tariffs of 50% on a wide range of Canadian goods starting August 19.
Canadian officials have told their American counterparts that carrying out the threat would lead to a significant deterioration in bilateral relations and would put Carney under strong domestic pressure to respond, potentially opening the door to a new round of trade escalation, according to people familiar with the talks.
