Tariffs imposed by U.S. President Donald Trump on Canada, Mexico, and China officially took effect on Saturday, immediately triggering backlash from multiple parties.

Trump, citing the International Emergency Economic Powers Act (IEEPA), announced a 25% tariff on Canadian imports (excluding energy resources, which face a 10% rate), a 25% tariff on Mexican imports, and a 10% tariff on Chinese imports. A White House statement said these tariffs would remain in effect until illegal immigration and the flow of drugs such as fentanyl into the United States are curbed.

A series of rapidly evolving events followed: Canada quickly announced retaliatory tariffs on U.S. goods but suspended them on Monday afternoon. Trump agreed to pause tariffs on both countries for 30 days after Canada and Mexico agreed to strengthen border controls. This flurry of news rattled markets, left consumers uneasy about the potential impact of tariffs on households, and prompted corporate executives to activate contingency plans.

Even with scenario planning in place, Tax Foundation economist Alex Durante noted that the costs and shocks from these tariffs could exceed those of Trump's first-term tariffs on China. Durante said: "Because the tariffs on Canada and Mexico cover a wide range of goods, the consequences could be more severe, and the costs higher than what we saw in the trade war with China."

Part of the reason is that the sweeping tariffs target both finished goods and intermediate inputs used to manufacture other products, leaving financial executives with less room to offset the tariff impact than during the earlier Trump tariffs on China. Durante said the first-term tariffs mainly targeted intermediate goods such as steel and aluminum, which companies could source elsewhere or find substitutes for.

But when sourcing agricultural products like Mexican winter strawberries, companies have little room to adjust, so affected businesses will raise prices to fully offset the tariffs. Durante said: "The full cost of the tariffs will be passed directly into prices. Essentially, consumers from both the north and the south will bear the shock."

Other major economic players also issued warnings about the potential negative impact of the tariffs on consumers and businesses.

In a Monday report from JPMorgan, analysts led by Bruce Kasman called the tariff announcement "a sharp shift in the U.S. stance toward the global trading order." The analysts also asserted that, based on their model estimates, if these policies were maintained for six months, the scale of the tariff increases would be enough to push the Mexican and Canadian economies into recession. Additionally, JPMorgan's Michael Feroli wrote on Sunday that although total goods imports from the three countries were slightly below $1.4 trillion, risks to the U.S. economic outlook "escalated significantly over the weekend," but he held off on adjusting his forecasts.

Feroli wrote: "Qualitatively, tariffs should push up prices and dampen growth. Even the president seems to acknowledge this, as he wrote this morning 'Will there be some pain? Yes, maybe (or maybe not!).'" He noted that the adverse growth and inflation effects would depend on how long the tariffs last and the retaliatory measures taken by trading partners. At the same time, he said, "even if tariffs were lifted tomorrow, the increase in policy uncertainty would be hard to reverse."

Meanwhile, the U.S. Chamber of Commerce issued a brief statement on Saturday criticizing the tariffs. The statement said: "The president is right to focus on major issues like border vulnerabilities and the fentanyl scourge, but imposing tariffs under IEEPA is unprecedented and will not solve these problems—it will only raise prices for American families and disrupt supply chains. The Chamber will consult with our members, including Main Street businesses across the country affected by this, to determine next steps to prevent economic harm to Americans."

Editor's note: This report has been updated to show that Trump has paused tariffs on Canada.