The two countries are aiming for a 1 August deal even after Trump announced a new 35% tariff on imports from Canada last week.

Trump threatened to escalate tariffs beyond 35% if Canada opts to retaliate with tariffs on U.S. goods. Canadian goods are also subject to sector-specific tariffs, such as 50% levies on steel and aluminum as well as 25% tariffs on non-USMCA compliant autos and auto parts.

Tariff negotiations between the two top trading partners are on a different track from those the U.S. is pursuing with other nations. But Canada may not get a better outcome.