Saskatchewan’s export-heavy economy could face turbulent times ahead following a whirlwind 24 hours on global markets, prompted by sweeping tariff announcements from U.S. President Donald Trump.
On Wednesday, Trump introduced a fresh round of tariffs, marking what Golden West Business Commentator Paul Martin called a “profound and fundamental change in the way the world order has been.” Global markets reacted swiftly and sharply Thursday morning, with significant losses seen on the Dow Jones and TSX. Commodities were also affected, with oil down by $5 from Wednesday's close.
One area that caught many a little off guard initially was a jump in the Canadian dollar, which was up 0.71 USD. While the Canadian dollar made surprising gains, Martin explained that the movement was less about Canada’s strength and more about weakness in the U.S. dollar.
“It’s almost counterintuitive, isn’t it? That the Canadian dollar would go up,” Martin said. “But in fact, I’d say probably it’s more realistic to say the Canadian dollar didn’t go anywhere. The American dollar went down.”
That shift, he explained, was driven by international reaction to the tariffs and the increasing unpredictability of U.S. trade policy under Trump. Investors had previously ignored threats of tariffs due to the administration’s inconsistency. But this time, Martin said, the market is taking the actions seriously.
“He really did something yesterday, and today the market’s responding. And responding quite sharply.”
The sudden jolt in global trade dynamics presents real concerns for Saskatchewan, where much of the economy depends on exporting commodities like oil, potash, uranium, and agricultural products.
“These are not happy days for us,” Martin noted. “We rely on smooth, easy trade patterns and trade rules. They got disrupted.”
There was a small silver lining: Canada wasn’t directly targeted with new tariffs in this round. Martin suggested this may be strategic, particularly with North American free trade renegotiations looming. He also pointed out that Saskatchewan’s resource base includes products the U.S. relies on, leading to less severe tariffs on Canadian goods.
“Even if he was going ahead with tariffs, he put lower ones in on us. And why? Because they need our stuff,” he said. “It probably says that they’re pretty dependent on us and they don’t want to increase the cost to themselves dramatically.”
However, Martin warned that the broader impact of the disruption may still hit home. With international commerce expected to slow, so too could economic activity, affecting everything from consumer sentiment to commodity prices.
“The price of oil here for us—it’s down sharply today,” he said. “Why? Because we expect less economic activity going forward.”
Ultimately, Martin emphasized the psychological impact on consumers as a key indicator to watch in the days ahead.
“Will people just sit on their wallets? … I’m not going to travel as much. I’m not going to go out for dinner. I’m going to save as much as I can. I’ll be very prudent and fiscally conservative.”
As global markets adjust to the tariffs and the changes to the world’s markets, Saskatchewan's fortunes will likely hinge on how long the uncertainty lasts—and how deeply it dampens demand.