Feb 11, 2026 · Trade tensions sharpen as Washington weighs a USMCA exit, Congress tests tariff authority, and the India deal wording shifts again.
President Donald Trump is reportedly weighing a dramatic escalation in North American trade policy: stepping away from the United States-Mexico-Canada Agreement, the pact that replaced NAFTA and was signed during his first term. The idea, discussed inside his administration, lands at a fragile moment for US-Mexico-Canada negotiations and reopens a question markets rarely like to price — what happens when the rules of a continent-wide trading system suddenly look optional.
The reported move adds fresh uncertainty to a week already defined by tariffs and political pushback in Washington. In the US House of Representatives, lawmakers are preparing to vote on whether to reject some of Trump’s tariff actions, after an effort led by Speaker Mike Johnson failed to stop the challenges from reaching the floor. The sequence matters: it signals that tariff policy is no longer just a White House lever, but a live test of political will inside Congress, heading into an election season where cost-of-living pressures are front of mind for many households.
The first resolution expected to go to a vote targets tariffs on Canada — a choice that highlights the awkward reality of the current moment. Canada is America’s closest major trading partner, deeply tied into US supply chains, energy flows, and manufacturing inputs. When tariffs rise on that relationship, the effects don’t stay neatly at the border; they tend to show up in pricing, corporate guidance, and the kind of inflation headlines politicians fear most.
Behind the scenes, Trump has also been pressing Canada and Mexico with a broader set of demands, with tariffs increasingly used as leverage in disputes that go well beyond trade. That approach, familiar from earlier chapters of his presidency, is now returning at scale — and with it comes the central risk investors watch: the possibility that tariffs become a permanent, unpredictable feature of doing business with the US, rather than a temporary negotiating tactic.
A separate flashpoint has emerged in aerospace. Trump has threatened steep tariffs on Canadian aircraft imports — reportedly as high as 50% — and suggested the US could tighten certification rules affecting new jets. Even for readers who don’t track aviation closely, the logic is straightforward: aircraft are high-value, long-cycle purchases, and a tariff shock can quickly ripple through order books, financing costs, and supplier networks. For Canada, the messaging also touches a sensitive industrial nerve, given how central aerospace manufacturing is to certain regions and export revenues.
The threats don’t stop there. Trump has also floated the possibility of extreme tariffs tied to Canada’s trade ties with China, framing the relationship as a strategic vulnerability. In that framing, tariffs become a tool of alignment — a way to pressure allies into choosing sides in a more fragmented global economy. It’s an approach that can move fast politically, but it tends to be messy economically, especially when multinational supply chains are still adjusting to post-pandemic logistics and shifting demand.
Meanwhile, confusion continues to swirl around the US-India trade arrangement announced earlier this month. The baseline tariff rate on goods from India was described as dropping to 18% from 25%, with additional changes linked to Russia’s oil exports and India’s purchases. But the White House has also adjusted language around agricultural goods in a way that has attracted attention — including removing a reference to pulses, a key staple in India. The edits may sound technical, yet small wording shifts can carry outsized meaning when they suggest a narrowing of commitments or a recalibration of what, exactly, was agreed.
Trump has also asserted that India’s Prime Minister Narendra Modi agreed to stop buying Russian oil, a claim that would — if realized — represent a significant geopolitical and economic pivot for a country that relies heavily on imports to meet its energy needs. The US position has included the removal of a “secondary” tariff tied to India’s purchases of Russian oil, underscoring how energy politics has become intertwined with tariff math. For businesses that trade across these corridors, it’s another reminder that tariffs are now being calculated not just on products, but on perceived alignment.
Taken together, the week’s signals point to a wider global trend: more nations appear to be reassessing how dependent they should be on the US as a trade anchor, with new or revived negotiations gaining urgency elsewhere. If the USMCA question grows louder and tariff threats keep multiplying, the incentive for partners to diversify trade exposure only increases — and so does the risk that the world drifts into blocs where “friend-shoring” becomes policy and friction becomes normal.
For readers watching this through a practical lens, there are three immediate watchpoints. First, whether Trump’s USMCA deliberations become formal action or remain a bargaining signal. Second, whether Congress proves willing to keep pressing votes that challenge tariffs, even if the White House resists. Third, whether tariff policy continues to expand into certification, energy sourcing, and alliance management — areas where the economic consequences can be larger than the headline percentage suggests.
One thing is already clear: trade policy is back at the center of politics, and the effects won’t be limited to diplomats and lawmakers. For consumers, tariffs can translate into higher prices and fewer choices. For companies, they can mean delayed investment decisions and cautious guidance. And for markets, the hardest part isn’t the tariff rate — it’s the uncertainty that comes when the next target, timeline, and exception clause can change in a single news cycle.
