Carney said earlier this month that the bans "are relatively modest measures" when compared to other trade actions the US has imposed on Canada.

He acknowledged, however, that the bans will hurt certain businesses and sectors that are directly targeted.

Derek Holt, an economist with Canadian bank Scotiabank, wrote in an analysis that "these actions are face-saving by the US administration, not substantive in nature and that's a positive".

About 93% of all Canadian liquor exports in 2025 were sold to the US. Spirits Canada, a group representing Canadian liquor producers, has said the consequences to the industry "could be significant"., external

US liquor producers also warned of consequences, with the Distilled Spirits Council writing that the import ban "will ripple throughout the US hospitality sector" as businesses gear up for the holiday season.

Last week, dozens of American liquor producers penned an open letter to Trump urging him to resolve the ongoing trade dispute with Canada with respect to alcohol.

Economists and businesses in Canada have also warned that the bans will add uncertainty to the future of country's trade relationship with the US, its largest trade partner.

In addition to these latest import bans, the US has imposed 50% tariffs on a range of Canadian goods, including dairy, alcohol, steel and aluminium products, as well as 25% tariffs on Canadian-built cars.

Canada in return has placed retaliatory tariffs ranging from 15% to 50% on more than 700 US products, as well as a 25% levy on certain steel and aluminium products. Most Canadian provinces have also stopped selling US liquor.

Tariffs - taxes paid on imported goods - are central to Trump's economic agenda, who argues that they raise government revenue and encourage consumers to buy American-made goods.

Economists, however, argue that they have raised prices of everyday goods for consumers and have disrupted the global economy.

Read More