US Ambassador Pete Hoekstra Sees Breakthrough in US-Canada Trade Talks—What It Means for Markets

Trade tensions thaw as US envoy signals progress—just don’t ask about the dairy lobby.

After months of deadlock, US Ambassador to Canada Pete Hoekstra drops the diplomatic equivalent of a moon emoji: "We're close." No specifics, no timelines—just the kind of vague optimism that sends analysts scrambling to update their PowerPoints.

Behind the scenes: Ottawa and Washington have been playing tariff tennis since 2024, with everything from lumber to electric vehicles caught in the crossfire. Now? A potential ceasefire that could boost cross-border commerce by billions—assuming the lawyers don’t ruin everything.

The crypto angle: While tradFi gets giddy over supply chain fixes, decentralized finance keeps humming along—no trade deals needed. Maybe that’s why Bitcoin’s up 12% this quarter while these clowns were still arguing over milk quotas.

Bottom line: When politicians say "progress," hold your applause. But if they actually deliver? Watch for a relief rally in TSX stocks—right after Wall Street takes its usual cut.

Hoekstra expresses optimism for an end to the US-Canada trade negotiation

The US, Canada, and Mexico already have a trade agreement that TRUMP signed in his first term.  The president, however, has avoided it, setting tariffs of up to 50% on imported steel and aluminum and duties on cars and trucks. Interestingly, Canada plays an important role in exporting all of those goods. 

On the other hand, the Canadian government imposed counter-tariffs on tens of billions of dollars worth of American-made goods. This included automobiles and other consumer goods. 

Notably, Carney, Canada’s prime minister since March, chose not to respond when Trump raised the tariffs on steel and aluminum weeks ago.

Meanwhile, trade talks restarted between the United States and Canada immediately after Ottawa removed a digital services tax, which the US objected to, according to WHITE House economic adviser Kevin Hassett. Hassett stated that when he was asked about the talks starting up again. 

This came after Mark Carney telephoned US President Donald Trump to inform him that the tax was being canceled, the White House press secretary Karoline Leavitt told reporters, describing it as a big win for US tech firms.

Leavitt described this as straightforward, referring to Prime Minister Carney giving in to President Trump and the US. She praised Trump’s tough negotiating approach for the change.

The secretary further stated that President Trump understands that every country needs to have strong trade ties with the US. Based on Leavitt’s argument, Canada made a mistake by promising to put in place a tax that would have harmed their tech companies.

The two leaders agreed on a July 21 deadline for reaching an agreement.

Hoekstra, who used to be a member of the US House of Representatives from Michigan, which relies heavily on trade with Canada, asserted that they will get through this. He then concluded that when this is all over, they will be stronger and better than they were at the start. 

Canada drops its digital services tax on the US, resulting in a trade deal with the nation 

Canada backed off a plan to start imposing a new digital services tax aimed at US technology giants just hours before it came into effect in hopes of helping MOVE forward the halted trade talks with the US.

This was after Trump asked Canada to drop the tax at a G7 meeting in Canada earlier in June. According to Hassett, this is something that they had studied, and now they had agreed to it. Therefore, Hassett anticipated that they could get back to the negotiations.

US Commerce Secretary Howard Lutnick commented on the situation in a post on X. Lutnick expressed gratitude to Canada for removing its Digital Services Tax. According to him, it was intended to stifle American innovation and would have been a deal breaker for any trade deal with America.

As a result of this change, stocks reached new highs on Wall Street as market sentiment lifted on hopes that the US would make progress on its trade negotiations with major trading partners, including Canada.

Your crypto news deserves attention - KEY Difference Wire puts you on 250+ top sites