U.S. hits E.U., Canada and Mexico with steel, aluminum tariffs, sparking trade war

The Trump administration on Thursday slapped tariffs on steel and aluminum imports from Canada, Mexico and the European Union, prompting outrage from America’s closest allies and major trading partners and setting off a trade war that could see U.S. consumers pay more for everything from canned soup to cars.

The move to implement tariffs under the guise of national security measures triggered strong response across the globe, including a firm reproach from Canadian Prime Minister Justin Trudeau, who denounced the punitive tariffs as "totally unacceptable" and "an affront," saying that the very idea that Canada could be considered a national security threat to the United States is "inconceivable."

Canadian Foreign Minister Chrystia Freeland announced $12.8 billion in retaliatory tariffs, which she called "the strongest trade action Canada has taken in the post-war era."

Mexico also responded to the taxes, saying it would impose tariffs of its own, and the European Commission promised legal action.

U.S. Commerce Secretary Wilbur Ross confirmed to reporters in an early-morning phone call that the White House will add a 25 percent import tariff on steel and a 10 percent tariff on aluminum after trade talks crumbled ahead of a June 1 deadline that would have enabled exemptions.

Market reaction was also swift: The Dow Jones fell sharply after the move was announced, dropping by 250 points as investors took measure of the impact of the ongoing trade tensions, and falling to 300 points after Canada's retaliation.