Canadian Money Brief | Feature

CUSMA Wasn't Renewed: The 10-Year Clock Now Running on Your Job, Prices and Savings

By MoneySavings.ca | Published November 2, 2026

Quick quiz: is Canada's free trade deal with the United States still in place? The honest answer is yes and no. The agreement known here as CUSMA is still in force, but since July 1 it has been on a different footing, and the way it plays out over the next decade matters to your paycheque, your grocery bill and your savings.

Most of us missed the moment because nothing visibly changed that day. That is exactly why it deserves a closer look, especially with the federal budget arriving Thursday.

The short version: CUSMA did not end. It moved from a long-term deal to a deal that gets reviewed every year until 2036. Roughly 90% of what Canada sells to the U.S. has been crossing the border tariff-free because of it, so each annual review is a chance for that protection to be tested. For households, this is a slow-burn risk to plan around, not a cliff to panic about.

What actually happened on July 1

CUSMA took effect on July 1, 2020, with a 16-year term. Every six years the three countries are supposed to meet and each confirm in writing that they want to extend it for another 16 years. The first of those reviews fell on July 1, 2026.

Canada and Mexico both confirmed they wanted the extension. The United States declined to renew the pact in its current form. Under the agreement's own rules, that does not cancel it. CUSMA stays in force until July 1, 2036, with a joint review every year in between, and the countries can still agree to extend it at any of those reviews. Any country can also leave by giving six months' notice, which is the escape hatch that keeps the uncertainty alive.

The process is already moving. The U.S. trade representative opened a public consultation on October 5 for the 2027 review, and comments are open until January 12, 2027. Law firms that watch trade closely say the July 1 outcome did not change day-to-day operations for businesses. Their bigger point is that the annual reviews give Washington a recurring platform to press for concessions on market access, trade balances and other issues.

Why one agreement carries so much weight

The reason is the exemption. Goods that meet CUSMA's rules of origin have been shielded from many of the broad U.S. tariffs. RBC Economics estimated that about 89% of Canadian exports to the U.S. in December entered without tariffs because they were CUSMA-compliant, and that Canada's average effective U.S. tariff rate was just 3.1%, the lowest of any major U.S. trading partner.

That protection has limits. CUSMA compliance does not broadly exempt goods from the sector-specific Section 232 tariffs on steel, aluminum, autos and lumber, which RBC says accounted for most of the duties collected on Canadian exports. And the 50% Section 338 tariffs that took effect in August apply even to goods that qualify under CUSMA. In other words, the exemption is valuable, it is already being chipped at, and now it comes up for review every year.

How it reaches your wallet

Your job. The sectors that feel trade uncertainty first are manufacturing, autos, metals, forestry and the businesses that supply them. If you or your partner work in one of those, or in a town that depends on them, the annual review cycle is a reason to keep your cash cushion healthy. Companies tend to delay hiring and investment when the rules might change every July.

Economic growth and interest rates. The Parliamentary Budget Officer recently cut its growth forecasts to 0.9% this year and 1.5% in 2027, blaming tariffs. Slower growth is part of why the Bank of Canada's recent rate hike is such a tight squeeze for households.

The loonie. National Bank economists have described lingering CUSMA uncertainty as one of the things capping the Canadian dollar's near-term upside. A cheaper loonie raises what you pay for U.S. travel, imported produce and anything priced in U.S. dollars.

Your investments. Canadian exporters and trade-exposed companies can swing on trade headlines. That is a good moment to check how concentrated your TFSA or RRSP is in a handful of those names.

Path through 2036	What it would mean	Signal for your wallet
Extension agreed	A fresh 16-year term and the end of annual reviews	Less trade risk priced into jobs, hiring and the loonie
Annual reviews continue	The deal stays in force but is renegotiated in public every year	Recurring headline risk; plan for volatility, not a one-time shock
A country gives notice to withdraw	A six-month countdown to leaving the agreement	Would put the tariff exemption itself at risk; the biggest test for jobs and savings

What to do with this, practically

Nothing about CUSMA's status requires you to change your plan this week. The useful response is resilience. Keep several months of essential expenses in cash, because trade-driven job losses tend to arrive in waves rather than all at once. If you are heading into a mortgage renewal, ask your lender about terms that leave you flexibility. If you have big U.S.-dollar expenses coming, such as tuition, a vehicle or a trip, convert in pieces rather than all at once. And if most of your investments sit in trade-exposed Canadian sectors, a quick look at diversification is worth the time.

What it means for you: A decade of annual reviews means trade headlines will keep coming, and some will move markets and the loonie. You can't control them. You can control your cash cushion, your debt flexibility and how concentrated your savings are in trade-sensitive names.

What to watch next

Date	Event
Tue, Nov 3	U.S. midterm elections
Thu, Nov 5	Federal budget, the first since CUSMA was not renewed
Fri, Nov 6	Statistics Canada's October jobs report
Wed, Dec 9	Next Bank of Canada rate decision
Tue, Jan 12, 2027	Public comments close for the 2027 U.S. review of the agreement

This article is general information, not financial or legal advice. Sources include McMillan LLP, The Hub, Prior Signal (citing the U.S. Trade Representative's July 1 statement), Mayo Law, RBC Economics, Brookings, Canadian Press, Mondaq, National Bank of Canada and the Parliamentary Budget Officer, with details as of November 2, 2026.