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Business week: NAFTA rhetoric knows no boundaries; Poloz watching GDP numbers

Jerome Powell takes over as Fed Chair in short order.Carolyn Kaster / Associated Press

OTTAWA — Despite the ongoing NAFTA standoff, recent events like Black Friday and the iPhone craze still show shoppers know few boundaries when it comes to sales.

Retail activity is up in Canada, even though many consumers continue to nip across the border to cash in on lower prices in the United States. And consumer costs in this country are down — ever so slightly — but still within the Bank of Canada’s comfort zone of one to three per cent, meaning the key interest rate is likely to stay where it is for now, at 1.25 per cent.

But there is a huge gulf between cross-border shopping and cross-border trade. As for renegotiating the North American Free Trade Agreement, it would appear that rhetoric also knows no boundaries.

“When the United States grows, so does the world,” President Donald Trump said last week in a speech to the annual World Economic Forum in Davos, Switzerland.

“American prosperity has created countless jobs around the globe and the drive for excellence, creativity and innovation in the United States has led to important discoveries that help people everywhere live more prosperous and healthier lives,” Trump said Friday. “The United States is prepared to negotiate mutually beneficial, bilateral trade agreements with all countries.”

Until now, however, six sessions aimed at reaching common ground on NAFTA — the last round is wrapping up Monday in Montreal — have produced little agreement on the big issues, such as “rules of origin” that determine who gets preferential tariff treatment within the U.S., Canada and Mexico, with auto production being a major issue in the talks.