In another move related to lowering tariffs, Trump pauses levies for imported ground beef

A truck passes over the Peace Bridge that connects Buffalo, N.Y., to Fort Erie, Ontario. Fresh U.S. tariffs and retaliatory Canadian levies could take effect overnight if the two countries can't finalize a trade deal.

U.S. President Donald Trump has held off on imposing new 50% tariffs on $20 billion worth of Canadian goods, saying his decision on Tuesday night to offer a three-day pause on the import taxes stems from American and Canadian negotiators getting close to achieving a new trade deal.

So now the big question is whether the negotiators can finalize that agreement. If they can't, the new 50% levies and retaliatory Canadian measures are expected to go into effect after midnight Eastern time.

It's also possible that Trump could announce another delay to allow for more negotiating time. U.S. and Canadian officials were engaged in additional talks on Friday.

One prediction market, Polymarket, is somewhat upbeat on an agreement coming through. There is a 62% chance that the U.S. and Canada will make a deal that lowers tariffs by Aug. 31, according to Polymarket. (Polymarket has a data partnership with Dow Jones, MarketWatch's publisher.)

Details about what's in the new trade deal have trickled out. U.S. tariffs on some Canadian steel and aluminum products are expected to drop to 25% from 50%, and Canadian provinces have agreed to put American alcohol products back on their store shelves after pulling them last year.

In addition, U.S. tariffs on Canadian-built automobiles are due to decrease to 15% from 25%, according to multiple published reports.

Ottawa also is expected to revise its dairy quota rules to improve U.S. market access, Chris Krueger, an analyst and managing director at TD Cowen's Washington Research Group, said in a note.

While Trump has suggested the contentious Keystone XL oil pipeline might be part of the new trade deal with Canada, Krueger said expansions for a different U.S.-Canada pipeline project, the Prairie Connector, look "far more realistic than a full KXL restart."

Trump on Tuesday night had said the Keystone XL pipeline, which had its permit revoked in 2021 by President Joe Biden, "may be awoken from the grave."

In another move related to lowering tariffs, Trump said in a social-media post on Friday morning that his administration will allow up to 300,000 metric tons of ground-beef imports to be exempt from higher tariff rates for the next 90 days.

The president said the move will "substantially lower the price of ground beef for working American families." Analysts have been predicting defeats for Trump's Republican Party in November's midterm elections due to voters' affordability concerns.

-Victor Reklaitis