In a significant forecast for global trade, the Chief Executive Officer of Bank of America Corp., Brian Moynihan, has predicted a de-escalation in the Trump administration's aggressive tariff policies starting in 2026. This comes after a year of economic shockwaves in 2025 triggered by sweeping new import duties.
From "Liberation Day" to De-escalation
Moynihan's comments, made in a pre-taped interview for CBS News' Face the Nation that aired in late December 2025, signal a potential shift. He stated that Bank of America's analysis now points toward "de-escalation, not escalation" in the coming year. The bank's forecast anticipates an average tariff rate of 15% across a broad base of U.S. trading partners.
This projected average marks a change from the turbulent rollout of tariffs earlier in the year. On April 2, 2025—a date President Donald Trump dubbed "Liberation Day"—his administration announced a baseline 10% tariff on all exports to the United States. A subsequent wave of new tariffs in July was expected to push the average rate for major partners to 15.2%. Analysis by Bloomberg Economics indicated the average U.S. tariff rate had already surged to 14% from just 2% after Trump's return to the White House.
Higher Rates for Uncooperative Nations, Special Cases Noted
Moynihan clarified that the 15% average would not be universal. He indicated that higher tariff rates would be applied to countries refusing to commit to U.S. purchases or to lowering non-tariff barriers. This creates a tiered system where cooperation is incentivized.
The Bank of America CEO singled out specific cases, noting that China remains a "different question" entirely, suggesting its trade relationship will follow a separate and likely more contentious path. Crucially for Canada, he highlighted that North American trading partners will also be a distinct focus, with a scheduled review of the United States-Mexico-Canada Agreement (USMCA) slated for 2026.
"But broadly in the world, you can see sort of the endpoint here," Moynihan concluded, expressing a view that the peak of tariff aggression may have passed.
Impact on Businesses and Lingering Uncertainties
The initial tariff shock in 2025 had a pronounced effect, particularly on small businesses in the second quarter. Moynihan acknowledged this impact, though he noted some relief came as rates later eased. Interestingly, he suggested that for small businesses currently, tariffs are now a lesser concern than other pressing issues.
According to Moynihan, the primary worries for these enterprises have shifted toward uncertainties in the availability of labor, exacerbated by Trump administration immigration policies that "haven't settled in yet." This points to a complex economic landscape where trade policy is just one of several volatile factors influencing business planning and growth.
For Canadian policymakers and exporters, Moynihan's forecast provides a cautiously optimistic lens for 2026. However, the pending USMCA review and the potential for higher targeted tariffs underscore that trade relations, particularly with the United States, will remain a top-tier economic priority requiring careful navigation.
