Mark Carney says ‘Canada Strong’ — but what does the CUSMA deadline — and potential disruption — mean for your portfolio?

Prime Minister Mark Carney has placed himself at the centre of the story, and his message to the U.S. — along with its sentiment — has shifted.

Why Carney changed his tone

Earlier this year, Carney argued that Canada’s deep economic integration with the U.S. had become a liability, and called for “middle powers” to unite. However, when speaking at the Economic Club of New York on May 28, 2026, he struck a very different tone, declaring: “‘Canada Strong’ will help make America great again.”

“While Canada and the United States have had our differences over the centuries, we have always worked and eventually worked through them because we share values and our common interests run deep,” Carney said.

The shift wasn’t accidental. Fraser Institute Senior Fellow Jock Finlayson, who also serves as chief economist at the Independent Contractors and Businesses Association (ICBA), says Canada’s push to reduce its reliance on U.S. markets has only made limited progress — the trade relationship, he noted, is “sticky.”

And the trade structure is the reason for that stickiness. Canada sends roughly three-quarters of its exports to the United States — Statistics Canada data for 2024 puts the figure at 75.9% of all domestic exports. Carney noted that Canada is America’s single largest export customer, and that approximately 70% of Canadian exports serve as inputs for American-made goods, including cars, homes, aircraft and machinery.

He also pointed to Canada’s role as a critical resource supplier, arguing that Canadian aluminum exports alone are the energy equivalent of “10 Hoover Dams.”

“It’s still the case that 85% of our trade goes across tariff-free,” Carney said. “Everyone benefits from that.”

What the CUSMA review means for Canadians

The July 1 trade review is critical. Under the CUSMA review process, all three governments must confirm in writing whether they wish to extend the agreement for another 16 years — locking in the deal until 2042. If the parties don’t agree to extend, the pact shifts to annual reviews — creating what the Bank of Canada has described as a “rolling negotiation” environment where businesses could face ongoing uncertainty for years.

On June 2, 2026, Canada-U.S. Trade Minister Dominic LeBlanc formally wrote to U.S. Trade Representative Jamieson Greer and Mexico’s Secretary of Economy Marcelo Ebrard, recommending renewal. But the U.S. has signalled repeatedly that it’s not interested in a straightforward renewal. Greer has said that “things have to be changed,” citing dissatisfaction with automotive imports and steel and aluminum trade flows.

For Canadians, the impact is real and hits close to home. The Bank of Canada has warned that a negative CUSMA review would lead exporters to cut production, investment and jobs — with ripple effects across the wider economy.

Canada’s economy is already under strain

The CUSMA review comes at a difficult time for the Canadian economy. Statistics Canada reported on May 29 that the economy shrank for the second quarter in a row — down 0.1% in Q1 2026, after a 1.0 % decline in Q4 2025, which economists consider a technical recession. Moreover, three of the last four quarters have now seen the economy contract.

Further, business capital investment fell 0.7% in Q1 2026 — its fifth consecutive quarterly decline — as companies delayed major decisions amid ongoing trade uncertainty. Canada’s unemployment rate rose to 6.9% in April 2026.

However, there’s a ray of optimism: Early estimates from Statistics Canada suggest the economy bounced back in April, with GDP growth of around 0.4% as the mining, oil and gas sectors picked up again. But the recession label is a concern for Canadian households — especially those renewing mortgages or carrying significant debt.

How tariffs ripple through your wallet

North American manufacturing relies on highly connected supply chains, with some parts crossing borders up to eight times before reaching the sales floor. Trade disputes break that chain — and reduce what factories can produce here.

These decisions directly impact your cost of living. Even the anticipation of a tariff can push prices higher, squeezing corporate profits and putting the Bank of Canada in a tough spot — trying to balance inflation and recession risk at the same time, which creates uncertainty across Canadian financial markets.

However, Canadians have seen this before. During the 2018-2019 tariff dispute, the U.S. imposed a 25% tariff on steel and a 10% tariff on aluminum, prompting Canada to hit back with its own tariffs — rattling manufacturing, industrial and agricultural sectors across the country.

That doesn’t mean you should make drastic moves with your portfolio. In fact, periods of uncertainty are often the right time to review and recommit to a long-term investment strategy.

Don’t let headlines slow you down

Trade negotiations, elections and geopolitical disputes create short-term volatility. However, long-term investors have historically been rewarded for staying invested through market ups and downs rather than trying to time them.

That’s where regular investing makes a real difference. Contributing a fixed amount at regular intervals — a strategy known as dollar-cost averaging (DCA) — means you naturally buy more units when prices are low and fewer when prices are high. Over time, this tends to lower your average cost per unit and provide some cushion against volatility.

For most Canadian investors, the Tax-Free Savings Account (TFSA) is the ideal vehicle for this approach. Tax-free growth means every dollar of compound return stays in the account. The 2026 annual TFSA contribution limit is $7,000, and unlike a Registered Retirement Savings Plan (RRSP), TFSA withdrawals are tax-free and contribution room is restored the following year.

Let’s consider the power of compounding over time: An investor contributing $500 a month earning an average annual return of 7% could accumulate roughly $612,000 over 30 years — despite investing only $180,000 of their own money. The difference comes from compound growth working continuously over time.

Tired of high commissions eating your returns? Compare Canada’s top discount brokerages and switch to a $0-commission platform today.

Consider assets that can weather uncertainty

While staying steadily invested is often the right strategy, what you invest in also matters — especially during periods of elevated trade risk.

In particular, gold can serve as a hedge during periods of market volatility and inflation. Because the precious metal’s value isn’t directly tied to any single company’s earnings or any one country’s economic performance, it’s often described as a safe-haven asset. When tariff fears push up consumer prices and erode the purchasing power of cash, gold has historically held its value.