nnCanada and the US failed to reach a new trade agreement by their August 1 deadline, extending a six-month tariff war between the neighbors. Both leaders downplayed prospects for a quick deal, with Canada prioritizing a quality agreement over speed despite facing 35% tariffs on some exports. Approximately 90% of Canadian goods remain duty-free under existing CUSMA terms, providing temporary relief while businesses seek certainty. Canada has imposed $43 billion in counter-tariffs and is actively diversifying trade partners and supply chains away from the US. Negotiators continue talks in Washington, though officials acknowledge an acceptable agreement remains elusive with no new deadline set.