US applies Section 232 or IEEPA tariffs averaging ≥10% on Canadian goods for the majority of months between 2026-01 and 2028-12?

Through the end of 2028, Washington keeps high tariffs on a rotating list of Canadian exports — steel, aluminum, autos, lumber, dairy, critical minerals — using whichever legal authority is available (national-security Section 232, emergency-powers IEEPA, or Section 301). Average effective tariff on Canadian goods sits at or above 10% in more than half of the months in this window. Ottawa retaliates with its own targeted lists but can't escape the asymmetry: 75% of Canadian exports go to the US, versus roughly 17% of US exports going to Canada. Canadian GDP takes a measurable hit (0.5–1.5% drag per year across the window), capital investment slows, and the loonie weakens. The relationship becomes transactional-permanent: every major sector negotiates its own carve-out, concessions are extracted annually, and 'friendly ally' rhetoric is replaced by hard mercantilism as the baseline posture.

A broad truce lands before the end of 2028. The 2026 CUSMA joint review becomes the vehicle for de-escalation — either because a political turnover in Washington changes posture, or because business lobbies on both sides force a comprehensive deal (auto-rules, dairy, lumber, digital services, critical minerals bundled together). Average tariff falls back below 10% for most months of 2027–2028. Both countries claim victory; Canadian firms rebuild cross-border supply chains that had been fragmenting; investment picks up. The relationship stays scratchy but functional, closer to the pre-2018 pattern than the 2024–2025 escalation.