President Donald Trump announced Tuesday that his administration will raise tariffs on Canadian steel and aluminum imports by an additional 25%, bringing the total duties to 50%. The new tariffs will take effect Wednesday morning.

Trump said the move was in direct response to Ontario's decision to impose a 25% tax on electricity exports to the U.S.

"Based on Ontario, Canada, placing a 25% Tariff on 'Electricity' coming into the United States, I have instructed my Secretary of Commerce to add an ADDITIONAL 25% Tariff, to 50%, on all STEEL and ALUMINUM COMING INTO THE UNITED STATES FROM CANADA, ONE OF THE HIGHEST TARIFFING NATIONS ANYWHERE IN THE WORLD," Trump wrote on Truth Social.

The market reacted sharply to the announcement, with the S&P 500, Nasdaq, and Dow Jones all turning negative following the news.

Ontario premier doug ford, who leads Canada's most populous province, announced the electricity tariff on Monday, stating it was a direct response to Trump's aggressive trade policies.

"I will not hesitate to increase this charge. If the United States escalates, I will not hesitate to shut the electricity off completely," Ford warned at a news conference in Toronto.

"Believe me when I say I do not want to do this. I feel terrible for the American people who didn't start this trade war. It's one person who is responsible, it's President Trump," he added.

With tensions rising, both sides appear unwilling to back down, raising fears of further economic disruptions.