Lenders weigh how a fresh trade shock could filter through to credit and housing
US president Donald Trump’s threat to “decertify” Canadian‑built aircraft and impose a 50% tariff on planes entering the United States open a new front in an already fraught trade stand‑off between Ottawa and Washington, with potential implications for Canada’s economy, jobs and, ultimately, mortgage markets.
In a post on social media platform Truth Social, Trump said his administration is decertifying Bombardier’s Global Express jets “and all Aircraft made in Canada” until rival US‑based Gulfstream wins Canadian certification for several of its large‑cabin business jets.
He also warned that if the situation is not “immediately corrected” he would “charge Canada a 50% Tariff on any and all Aircraft sold into the United States of America.”
Aircraft spat adds to broader tariff fears
Trump’s move comes on top of earlier threats to levy sweeping duties on Canadian imports and complaints that Ottawa has “wrongfully, illegally and steadfastly refused to certify the Gulfstream 500, 600, 700 and 800 Jets, one of the greatest, most technologically advanced airplanes ever made,” as he put it.
Using air‑safety approvals in a trade dispute would have been unprecedented; certification decisions has historically been left to Federal Aviation Administration experts rather than presidents.
Bombardier, which pointed to thousands of US employees and suppliers, urges a quick resolution. “Our aircraft, facilities and technicians are fully certified to FAA standards and renowned around the world,” the company said in a statement. “We hope this is quickly resolved to avoid a significant impact to air traffic and the flying public.”
Mortgage watchers focus on jobs, confidence and rates
For mortgage professionals, the immediate concern sits less with aircraft sales than with what another escalation in US–Canada tensions could do to growth, unemployment and rate expectations.
“The threat to the housing market would be the indirect effect of a weaker economy,” Bank of Montreal chief economist Doug Porter said in earlier comments on US tariffs.
He warned that a protracted trade conflict could shave around two percentage points off Canada’s growth and risk a modest recession if measures stayed in place for a year.
The Bank of Canada already cautioned that a long‑lasting trade war poses the greatest threat to the Canadian economy and could undermine households’ and businesses’ capacity to service debt, with knock‑on effects for banks’ willingness to lend, governor Tiff Macklem said.
Mortgage‑market analysts also highlighted the confidence channel. “A trade war with the US won’t have an immediate impact on home prices, but it could have a chilling effect on demand,” mortgage expert Clay Jarvis said, noting that higher everyday costs could push marginal buyers to the sidelines and that worries about jobs would make households more cautious about taking on new mortgages.
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