Evelyn Reynolds

U.S. Vice President JD Vance (C) exits the Oval Office in the opposite direction as U.S. President Donald Trump and Elon Musk (R) walk away before departing the White House on March 14, 2025.
Roberto Schmidt | Afp | Getty Images

The UCLA Anderson Forecast, citing substantial changes to the economy from policies of the Trump administration, issued its first-ever “recession watch” on Tuesday.
UCLA Anderson, which has been issuing forecasts since 1952, said the administration’s tariff and immigration policies and plans to reduce the federal workforce could combine to cause the economy to contract. 

Its analysis was titled, “Trump Policies, If Fully Enacted, Promise a Recession.”
“While there are no signs of a recession happening yet, it is entirely possible that one could form in the near term,” stated a news release from the forecaster. 
U.S. recessions are only officially declared by the Business Cycle Dating Committee of the National Bureau of Economic Research. The committee employs a variety of indicators, including production, employment, income and growth to determine if the economy is contracting. At the moment, none of the specific indicators look to be near levels that would prompt the committee to declare recession. 
The average respondent to the CNBC Fed Survey for March, published Tuesday, forecast a 36% recession probability in the next year, up from 23% in the prior month. But it remains well below the 50% level that prevailed from 2022 and 2023 in the wake of the pandemic and turned out to be wrong. That shows how difficult it is to predict a recession, or even determine if the economy is in one. The Fed Survey also shows that a recession is not the base case for most Wall Street forecasters, only that the concern is somewhat elevated.
Recessions occur when multiple sectors of the economy contract at the same time. The UCLA Anderson Forecast said reductions to the workforce from the administration’s immigration policies could create labor shortages, tariffs will raise prices and could lead to a contraction in the manufacturing sector while changes to federal spending will reduce employment for government workers and private contractors.

“If these and their consequent feedback into the demand for goods and services occur simultaneously, they create a recipe for a recession,” the statement from the forecaster said. 

‘Stagflationary’

Administration officials, from the President to his top economic lieutenants, have not specifically pushed back against the possibility of recession from their policies. President Trump has said there would be a “period of transition,” while the Commerce Secretary had said a recession will be “worth it” for the gains that will eventually come from the policies.
Recessions are often the result of unexpected shocks to the economy. The surge in optimism following the election of President Trump, followed by the recent sharp drop off in some surveys, suggest that both businesses and consumers were unprepared for the extent and even the nature of some of the policies now being pursued. 
On timing, the UCLA Anderson Forecast would only say a recession could develop in the next year or two. Its report said: “Weaknesses are beginning to emerge in households’ spending patterns. And the financial sector, with elevated asset valuations and newly introduced areas of risk, is primed to amplify any downturn. What’s more, the recession could end up being stagflationary.” More

Fed officials at this week’s meeting are expected to hold interest rates steady but adjust their views on the economy and possibly the future path of interest rates.
The committee could maintain its outlook for two cuts, remove one or both, or, improbably, add another as a statement of concern over a potential slowdown. Everything seems to be on the table.
Chair Jerome Powell and his colleagues in recent weeks have advocated a patient approach in which they don’t need to be in a hurry to do anything.

U.S. Federal Reserve Chair Jerome Powell testifies before a Senate Banking, Housing and Urban Affairs Committee hearing on “The Semiannual Monetary Policy Report to the Congress,” at Capitol Hill in Washington, U.S., Feb. 11, 2025. 
Craig Hudson | Reuters

Federal Reserve officials at this week’s meeting are expected to hold interest rates steady but adjust their views on the economy and possibly the future path for interest rates.
If market pricing is correct, there’s virtually no chance central bank policymakers budge from the current level of their key interest rate, targeted in a range between 4.25%-4.5%. Chair Jerome Powell and his colleagues in recent weeks have advocated a patient approach in which they don’t need to be in a hurry to do anything.

However, they are also expected to drop clues about where things go from here against the uncertain backdrop of President Donald Trump’s trade and fiscal policies. That could include anything from tweaks in projections for inflation and economic growth to how often, if at all, they expect to lower interest rates further.
“There’s no chance of a cut Wednesday, so all the other stuff becomes more important,” said Dan North, senior economist at Allianz Trade North America. “They’re basically going to say, ‘You know what, we are in no hurry at all now.'”
Indeed, that has been the prevailing message from Powell and his Federal Open Market Committee colleagues. In a speech earlier this month to economists in New York, Powell insisted “there is no need to be in a hurry” as central bankers seek “greater clarity” on where the Trump administration is headed.
New outlook for GDP, inflation, unemployment
The public, then, will be left to pore through updates the Fed makes to its quarterly projections on interest rates, gross domestic product, unemployment and inflation. Based on recent data, the Fed could raise its 2025 outlook for inflation (in December, the outlook was for 2.5% in both core and headline) while lowering its GDP projection (from 2.1%). Powell will host his usual post-meeting news conference.
On the rate question, the Federal Open Market Committee will use its “dot plot” grid of individual members’ intentions.

There’s significant disagreement on what could happen there. The committee could maintain its December outlook for two cuts, remove one or both, or, improbably, add another as a statement of concern over a potential slowdown. Everything seems to be on the table.

“I think it may be one or zero cuts this year, particularly if the tariffs stick,” North said. “I don’t think they’re going to try and bail out the economy by cutting rates, because they know that if they stoke inflation, they’re going to have to go back and start all over again.”
Economists worry the Trump tariffs could reignite inflation, particularly if the president gets more aggressive after the White House releases a global review of the tariff situation on April 2. If the Fed grows more concerned about tariff-fueled inflation, it could turn even more reluctant to cut.
Investors are right to be concerned about the direction the FOMC indicates, said Thierry Wizman, global FX and rates strategist at Macquarie.
“That worry is borne by the suspicion the Fed is not ‘in charge’ anymore, having relinquished control of macroeconomic policy to the Trump administration,” Wizman wrote. “Given the current uncertainty, and the recent increase in inflation expectations, the Fed may find it difficult to signal three more rate cuts, or even two more. It could push one rate cut into 2026, leaving only one cut in the median ‘dot’ for 2025.”
Markets still see two or three cuts
Should the Fed decide to stick with two cuts, it likely will be only “to avoid adding to recent market turbulence,” Goldman Sachs economist David Mericle said in a note.
Major stock market averages are hovering around correction territory, or 10% declines from highs.
In the past, under the idea of a “Fed put,” markets have come to expect the central bank to ease policy in response to market unrest. Traders don’t expect an initial rate reduction to happen until at least June, and are pricing in one additional quarter percentage point easing and about a 50-50 chance of a third move by the end of the year, according to the CME Group’s FedWatch measure of fed funds futures pricing.
But that might even be too ambitious, Wizman said.
“In effect, markets appear to have gotten too dovish on the Fed, and instead of signaling its own confidence in its outlook, the Fed may issue signals of no-confidence, instead. In other words, the FOMC meeting may leave many questions unanswered, as will the press conference by Jay Powell,” he said, using Powell’s nickname.
The committee also could address its “quantitative tightening” program where it is allowing a set level of proceeds from maturing bonds to roll off the balance sheet each month. Markets widely expect the Fed to end the program later this year, and recent meetings have featured discussion about how best to handle the central bank’s $6.4 trillion portfolio of Treasurys and mortgage-backed securities. More

Retail sales increased 0.2% on the month, better than the downwardly revised decline of 1.2% the prior month but below the Dow Jones estimate for a 0.6% increase.
The so-called control group, which strips out non-core sectors and feeds directly into gross domestic product calculations, rose a better than expected 1%.
Also, the New York Fed’s measure of factory activity in the region posted an unexpectedly sharp drop for March.

Consumers spent at a slower than expected pace in February, though underlying readings indicated that sales still grew at a solid pace despite worries over an economic slowdown and rising inflation.
Retail sales increased 0.2% on the month, better than the downwardly revised decline of 1.2% the prior month but below the Dow Jones estimate for a 0.6% increase, according to the advanced reading Monday from the Commerce Department. Excluding autos, the increase was 0.3%, in line with expectations.

The sales number is adjusted for seasonal factors but not for inflation. Prices rose 0.2% on the month, according to a previous Labor Department report, indicating that spending was about on pace with inflation.
The so-called control group, which strips out non-core sectors and feeds directly into gross domestic product calculations, rose a better than expected 1%.
“Not a great report, but one still in positive territory despite how pessimistic consumers are about the future,” said Robert Frick, corporate economist with Navy Federal Credit Union. “But the main factor in consumer spending is consumer income, and that’s growing at a good rate and had an impressive leap in January.”
Online spending helped boost the sales number for the month, with nonstore retailers reporting a 2.4% increase. Health and personal care showed a 1.7% gain while food and beverage outlets saw a 0.4% increase.
On the downside, bars and restaurants reported a 1.5% decrease while gas stations were off 1% amid falling prices at the pump.

Sales overall increased 3.1% on a year over year basis, better than the 2.8% inflation rate as measured by the consumer price index.
One other downbeat note from the report was a steep revision for January, which originally was reported as a 0.9% decline.
The release comes amid heightened worries over economic growth, particularly as President Donald Trump engages in an aggressive tariff battle with leading U.S. trading partners. Economists worry that the tariffs will drive up inflation and slow the economy.
“Consumers and businesses are expected to pull back on spending when they’re unable to make informed decisions about the future of the economy and their place within it,” said Elizabeth Renter, senior economist at personal finance site NerdWallet. “Currently, direct economic policies and broad federal policies with indirect economic impact are in flux, making informed decisions difficult.”
Some indicators, such as the Atlanta Federal Reserve’s GDPNow tracker of economic data, are showing that growth could be negative in the first quarter, though the solid reading for control retail sales could result in an upward revision later today.
In other economic news Monday, the New York Fed’s measure of factory activity in the region posted an unexpectedly sharp drop for March.
The Empire State Manufacturing Survey posted a reading of -20 for the month, representing the difference between companies seeing expansion against contraction. The number indicated a drop from the 5.7 level in February and was well below the estimate for -1.8.
New orders posted a sharp slide, with the index tumbling to -26.3, down 14.9 points. Shipments also were off significantly. On inflation, indexes for prices paid and received also rose. More

Global growth is expected to slow from 3.2% in 2024 to 3.1% in 2025 and 3.0% in 2026, according to the OECD. It had previously forecast 3.3% global economic growth this year and next.
The U.S.’s annual GDP growth is also projected to fall to 2.2% in 2025 and 1.6% in 2026 — down from earlier forecasts of 2.4% this year and 2.1% next year.
“A series of recently announced trade policy measures will have implications for the economic outlook if sustained,” the OECD said.

Both U.S. and global economic growth is set to be lower than previously projected as President Donald Trump’s proposed tariffs on goods imported to the U.S. weigh on growth, according to the latest estimates from the Organisation for Economic Co-operation and Development.
“Global GDP growth is projected to moderate from 3.2% in 2024, to 3.1% in 2025 and 3.0% in 2026, with higher trade barriers in several G20 economies and increased geopolitical and policy uncertainty weighing on investment and household spending,” the OECD said Monday in its interim Economic Outlook report.

“Annual GDP growth in the United States is projected to slow from its strong recent pace, to be 2.2% in 2025 and 1.6% in 2026.”
In its previous projections, published in December, the OECD had estimated 3.3% global economic growth this year and next. The U.S. economy had been expected to grow 2.4% in 2025 and 2.1% in 2026.
Mathias Cormann, secretary-general of the OECD, on Monday said that the uncertainty around trade policy was a key factor in the organization’s projections.
“There’s a very significant level of uncertainty right now, and you know it is clear that the global economy would benefit from increases in certainty when it comes to the trade policy settings,” he told CNBC’s Silvia Amaro.
In its report, the OECD said its latest projections were “based on an assumption that bilateral tariffs between Canada and the United States and between Mexico and the United States are raised by an additional 25 percentage points on almost all merchandise imports from April.”

If the tariff increases were lower, or applied to fewer goods, economic activity would be stronger and inflation would be lower than projected, “but global growth would still be weaker than previously expected,” the report noted.

Canada and Mexico, both on the receiving end of tariffs imposed by the U.S., saw their growth outlooks slashed dramatically. Canada’s economy is now expected to grow 0.7% this year, down from the previous 2% estimate, and Mexico’s is projected to shrink by 1.3% — compared to a previously estimated 1.2% expansion.
The OECD also updated its inflation forecast, saying price growth was set to be higher than previously expected, but would ease due to moderating economic growth.
“What we see is that inflation will continue to go down, but that inflation is expected to go down more slowly,” Cormann told CNBC. “What we are suggesting is that some of the measures in relation to trade, some of the measures in relation to tariffs, and the related policy uncertainty, certainly are having an impact on inflation.”
Headline inflation in the U.S. is now expected to come in at 2.8% in 2025 according to the latest figures, up from the 2.1% December estimate, while the projection for G20 economies has risen from 3.5% in December to 3.8% in Monday’s report.
“Core inflation is now projected to remain above central bank targets in many countries in 2026, including the United States,” the OECD added.
OECD head Cormann said central bankers should now “remain vigilant.”
“Certainly, if inflation expectations remain anchored, we do believe that in even major economies like the United States and the United Kingdom, there is scope for further policy easing,” he said, but pointed out that in some major economies the pace of inflation easing has slowed or inflation has picked back up.

Trade policy tensions

The OECD linked much of its update to economic growth and inflation estimates to geopolitical and trade tensions — issues that have dominated markets in recent weeks and months.
“A series of recently announced trade policy measures will have implications for the economic outlook if sustained,” the OECD said, pointing to the tariffs imposed, or threatened by, Trump, and potential retaliatory duties imposed by its trading partners.
Trump’s tariff policies have been marked by uncertainty over recent weeks, as negotiations and retaliation threats continue. The president has flipped-flopped over when tariffs will be imposed, which goods they will apply to and how high they will be, although he insisted last week that he wasn’t “going to bend at all.”
“If the announced trade policy actions persist, as assumed in the projections, the new bilateral tariff rates will raise revenues for the governments imposing them but will be a drag on global activity, incomes and regular tax revenues. They also add to trade costs, raising the price of covered imported final goods for consumers and intermediate inputs for businesses,” the OECD said.
Asked if he agreed with U.S. President Trump’s position that his trade policies could involve short-term pain, but long-term benefits for the country’s economy, the OECD’s Cormann said that lower global economic growth and higher inflation would have “flow on consequences” for the U.S.
If trade tariffs were reversed, there would be a “positive impact” on global growth, and therefore also U.S. economic growth, he said.
Cormann said that it was important to keep markets open and ensure they are functional and to have “rules based trading system in good working order,” adding that any issues should be resolved through cooperation and dialogue.
“We would encourage everyone to engage with each other and to honestly and openly, work through the issues at hand and try and find the best possible way forward without having to resort to tariffs and other trade restricting measures,” he said. More

President Donald Trump’s controversial plans for tariffs and comments about Canada becoming a state has angered the country’s consumers and politicians.
Canada has long been a key ally and trade partner for the U.S., with residents shopping American brands and flocking south of the border for vacations.

A “Shop Canadian” sign is seen at the entrance of a supermarket in Vancouver, British Columbia, Canada, March 4, 2025. 
Liang Seng | Xinhua News Agency | Getty Images

Canadians are swapping their friendly auras for a fierce sense of nationalism amid U.S. President Donald Trump’s attacks on the country’s trade and sovereignty.
Trump’s mostly delayed plans for 25% tariffs on Canadian goods and his calls for the country to become an American state has spurned citizens of the U.S.’s northern neighbor and key trade partner. As a result, Canadians have rejected American imports and issued other economic punishments in an unusual show of patriotism.

“It really feels for most Canadians like we’ve been backstabbed, that the person that we trusted the most is now sort of turning on us and attacking us for no apparent reason,” said Joel Bilt, an economics professor focused on international trade at the University of Waterloo in Ontario. “That has really unified people.”
Grocery stores have encouraged visitors to “shop Canadian” with signs and special labels in aisles alerting them to which products were made domestically. A popular Facebook group focused on buying Canadian-made goods first reported on by NBC News has seen its membership more than double since early February as the on-again-off-again tariff policy played out.

A “Shop Canadian” sign is seen at the entrance of a supermarket in Vancouver, British Columbia, Canada, March 4, 2025. 
Liang Seng | Xinhua News Agency | Getty Images

More than 60% of Canadians reported buying fewer American products when shopping either in store or online, according to a survey from market research firm Leger of more than 1,500 residents conducted between March 7 and March 10. Just over seven out of 10 said they upped their purchases of goods made within the country, which has the ninth largest economy in the world.
The Liquor Control Board of Ontario went even further, barring its members from ordering American alcohol. Because the LCBO sells upwards of $1 billion in American liquor each year, the move has raised alarm for U.S.-based spirit makers like Jack Daniel’s parent Brown-Forman.
“That’s worse than a tariff,” said Lawson Whiting, chief executive of Brown-Forman, on the Kentucky-based company’s earnings call this month. “It’s literally taking your sales away.”

Empty shelves remain with signs ”Buy Canadian Instead” after the top five U.S. liquor brands were removed from sale at a B.C. Liquor Store, as part of a response to U.S. President Donald Trump’s 25% tariffs on Canadian goods, in Vancouver, British Columbia, Canada, February 2, 2025. 
Chris Helgren | Reuters

Ontario also said it would implement a 25% surcharge on electricity exported to Michigan, Minnesota and New York. But Ontario Premier Doug Ford said that he would temporarily halt this tax after U.S. Commerce Secretary Howard Lutnick agreed to restart negotiations.
Trump initially responded by calling to raise tariffs on Canadian steel and aluminum to 50%, but the White House told CNBC that he backed down following the conversation between Lutnick and Ford.
Still, Trump’s now-withdrawn plan for higher taxes on the metals put the United Steelworkers union — which represents about 850,000 people in the U.S., Canada and the Caribbean — on alert. USW International President David McCall said in a March 11 statement that the North American arms of the international trade organization would “fight together” against the proposed levies, which he said threatens jobs on both sides of the U.S.-Canadian border.

A ‘pushback’

Even as the tariff negotiations remain in flux, travel to the U.S. is already taking a hit. Return trips by Canadians from the U.S. by vehicle tumbled around 23% in February from the same month a year ago, according to government statistics.

Government data also showed the number of Canadians flying back into the country from international locations declined in February from a year ago, signaling a pullback in tourism abroad. That comes as Air Canada announced plans to cut capacity to warm U.S. locations like Florida, Arizona and Nevada beginning this month.
Trump’s threats have prompted some cancellations to the Wildwoods in New Jersey, a popular beach destination for travelers from places like Montreal and Quebec, according to Ben Rose, marketing and public relations director at the Greater Wildwoods Tourism Authority. But he said these rescissions haven’t been as widespread as initially expected. Canadians are also weighing concerns around the exchange rate, he added.

Air Canada planes are seen at the gates at Montréal-Pierre Elliott Trudeau International Airport in Dorval, Quebec, Canada on April 2, 2024. 
Daniel Slim | Afp | Getty Images

At consumer travel shows in Toronto and Montreal, the authority received some comments from potential Canadian travelers about how Trump’s plan for levies has deterred vacationing in America. Rose said his team reminds uneasy Canadians that it has been a welcoming destination for them over several decades and provides unique value as a location within driving distance.
“Some of the pushback we’ve been getting is that: ‘You know we love Americans, and we know they love us, but we’ll see you in four years,'” Rose said. “They can’t go along with the administration.”

Political, cultural efforts

Canadians’ stance against Trump’s policies has spilled into culture and media as the issue captured the country’s interest.
Canadians booed the U.S. national anthem before major-league sporting games against American teams. During an appearance on Saturday Night Live this month, Canadian celebrity Mike Myers donned a shirt that reads “Canada is not for sale” alongside the country’s red-and-white flag.

(l-r) Musical guest Tate McRae, host Shane Gillis, and special guest Mike Myers during Goodnights & Credits on Saturday, March 1, 2025.
Will Heath | NBCUniversal | Getty Images

Tariffs have become a focal point of Canada’s government, which saw ex-central banker Mark Carney clinch the prime minister title this month. Carney succeeds Justin Trudeau, who Trump had begun referring to as “governor” in reference to his hopes of making Canada a U.S. state.
The British Columbia government and its power operator said they would exclude Tesla products from certain green-energy rebates as of March 12, an action done to give “preference” to Canadian-made alternatives. Tesla is run by CEO Elon Musk, who has come under fire from critics for his leadership of Trump’s controversial government efficiency initiative.
Waterloo’s Bilt said Canadians’ anger is focused mainly on Trump rather than Americans at large, meaning personal relationships between citizens of each country likely wouldn’t be frayed as a result. However, he said American businesses should expect Canadians — once known as a laid-back, polite group that didn’t think twice about shopping U.S. brands or vacationing south of its border — to rebuff them until Trump backs down.
“It really has elicited the kind of response that I have never seen before,” Bilt said. “Canadians are not fundamentally nationalistic, but this really sort of hit something strong at the core of the average Canadian.”
— NBC News and CNBC’s Dan Mangan and Laya Neelakandan contributed to this report.
Disclosure: Saturday Night Live is part of NBCUniversal, which also owns CNBC. More

President Donald Trump’s tariffs on Canadian products, along with the escalating trade war and rhetoric between the two nations, is starting to squeeze some small businesses in Vermont.
Concerns for those small businesses include a decline in merchandise shipments to Canadian customers, a drop off in Canadian tourism and higher prices from imported products.
“I would rather take the position of being proactive and not just thinking about absorbing the problem,” said Bill Butler, a co-owner of Artisans Hand Craft Gallery in Montpelier.

Ryan Christiansen, president and head distiller at Caledonia Spirits, giving a tour in Montpelier, VT.
Courtesy: Ryan Christianse | Caledonia Spirits

President Donald Trump’s tariff rhetoric against Canada has only started to heat up, but Vermont’s small businesses are already feeling some pain.
A shipment of spirits, ordered by the Société des alcools du Québec – an entity that’s responsible for the trade of alcoholic beverages in the province – has been sitting on a shipping dock at Montpelier-based Barr Hill by Caledonia Spirits for about a month.

The SAQ called off the order shortly after Trump announced the tariffs against Canada in February, according to Ryan Christiansen, president and head distiller at Caledonia Spirits.
“Customers are ready to buy, and we are in the peak of slow season – it’s an annual cycle for us, and we were looking forward to shipping the order. Now, it’s sitting on the dock,” he said. “To have this hit our business in the slow month of February? We missed our financial plan in February because of this.”

Exports at Caledonia Spirits in Montpelier, VT.
Courtesy: Ryan Christiansen | Caledonia Spirits

Vermont has a special relationship with Canada, as the Green Mountain State exports $680 million in goods to the U.S.’s northern neighbor annually, according to data compiled by Connect2Canada. Vermont imports more than $2.6 billion in goods from Canada each year, with electricity and fuel oil among the top imported goods.
Because of the state’s close business ties to Canada and their shared borders, small businesses in Vermont began seeing some fallout as early as February – when Trump first announced a round of 25% tariffs on goods from Mexico and Canada, triggering 25% retaliatory levies from then-Canadian Prime Minister Justin Trudeau. At the time, Ontario also said it would pull American alcohol products from its shelves.
Ultimately, Trump granted a reprieve on Canadian and Mexican goods covered by the North American trade agreement USMCA until April 2. However, many products are still subject to the duties.

“We worked really hard to maintain this relationship with the Canadian government,” Christiansen said. “How do I get them to buy as much as the Canadian customer wanted to buy? Even if the tariffs go away, I think it’s overly optimistic that this order gets resubmitted.”
Tourism worries
It didn’t take long for Steve Wright, president and general manager of Jay Peak Resort, which is about 10 miles from the Canadian border, to begin seeing the impact of the rhetoric around tariffs.
He noted that spending from Canadian tourists showed signs of softening particularly in two key weeks: Quebec break week, which ran from March 3 to March 8, and Ontario break week, which kicked off on March 10.
Though Canadian visitors generally account for about half of the resort’s market, they make up virtually all of it during that two-week stretch, Wright said.

Arrows pointing outwards

People ski at Jay Peak in Jay, VT.
Courtesy: Patrick Coyle, Darla Mercado | CNBC

“The Quebec break week sold really well, and we had great conditions, but what was missing was the day market,” he said. “We did not get the day traffic we usually see from Montreal, that part of the market softened up.”
Tariff rhetoric has only been the latest pressure point for Jay Peak. The resort’s manager also pointed to the reduction in hours of operation for the nearby North Troy, VT border crossing. It went from 24 hours a day to 8 a.m. to 8 p.m. in January.
To accommodate its Canadian clientele over the past two decades, Jay Peak has been offering at-par options for these tourists on non-margin products. “Say a lift ticket is $100, you can give us C$100,” Wright said. “That has insulated the business a little bit.”
“They have an affinity for Jay Peak; they have been coming here for a generation, but there is a point where they will decide to stay home despite their love of the place,” he added.
In Montpelier, which is a roughly two-to-three-hour drive from Montreal, worries about tourist traffic are already bubbling among small businesses. This corner of the state tends to see weekend visitors from up north, particularly in the temperate summer and fall seasons.
Bill Butler, a co-owner of Artisans Hand Craft Gallery, has been in talks with fellow entrepreneurs in downtown Montpelier to propose promotional deals for Canadian visitors to keep the foot traffic coming.
“My idea is to have something like ‘Canada Days,'” he said. “We’d have a deal for Canadians who want to come down, have a little tour of the city and go from place to place, and get a free beer or coffee.”
“I would rather take the position of being proactive and not just thinking about absorbing the problem,” Butler said. “We have a great relationship with Canada, and we see a lot of Canadians in the gallery.”
The price of imported goods
For Sam Guy, owner of Guy’s Farm & Yard in Morrisville, tariffs are raising concerns over higher prices for certain products.
Wood shavings, wood pellets and peat moss sold at the local chain store all come from Canada, while animal feed – though made by an American company – includes ingredients that come from Canada, he said.
A 25% tariff tacked onto imported products would inevitably have to be passed on to shoppers.
“We can’t eat this,” Guy said. “We’re going to pass on the tariff. We’re not going to add a margin or anything like that, but a lot of these are low margin products.” More