U.S. Commerce Secretary Howard Lutnick said on Thursday that a 35% tariff on all Canadian goods not covered by the U.S.-Mexico-Canada trade agreement is still "surely in the cards," ahead of an Aug. 1 deadline imposed by President Donald Trump.

U.S. President Donald Trump said Thursday he has not "spoken to Canada" as his tariff deadline looms. Trump did say that "he's called" — suggesting Prime Minister Mark Carney may have reached out hours before a 35 per cent tariff is set to hit Canada.

President Trump said Canada’s announcement it will recognize a Palestinian state “will make it very hard” for the U.S. to reach a trade agreement.