If U.S. President Donald Trump follows through on his threat to impose 25 per cent tariffs on most Canadian goods entering the U.S. on Tuesday, Canada’s economy is likely to enter a recession by the middle of this year, according to Desjardins’ deputy chief economist.

Randall Bartlett told BNN Bloomberg in a Monday interview that based on Desjardins’ analysis of the economic impacts of Trump’s proposed tariffs, he and his team believe “it will be very difficult for the Canadian economy to not fall into recession” within a few months if tariffs are imposed.

“Ultimately, retaliatory tariffs are just going to exacerbate that and also lead to higher inflation, so it will provide a bit of a challenge for the Bank of Canada in terms of contending with a negative shock to gross domestic product (GDP) and at the same time, upward pressure on inflation,” he said.

Bartlett called the potential inflationary impacts of a tariff war “multifold,” and noted that it would likely cause both short- and long-term inflation spikes.

“When it comes to tariffs applied by the U.S., those have implications for the Canadian dollar, and ultimately that’s going to impact other things that we import and re-import from the U.S. as well, so ultimately that puts upward pressure on domestic inflation to some extent,” he said.

“But then when we apply those retaliatory tariffs, those are tariffs, just like any tariff, that are going to be paid by the citizens, the businesses and the households of the country importing those goods… that (also) feeds into higher inflation in Canada.”

Bartlett said that a tariff war would be a “net-negative” for both the American and Canadian economy, but tariffs and counter tariffs remain politically popular on both sides of the border, nonetheless.

“Clearly it’s been politically successful in the U.S., even if it’s not going to be an economically successful policy south of the border,” he said.

“A lot of those same considerations I think are playing out in Canada, where retaliatory tariffs, we know are going to exacerbate the economic downturn… but at the same time, there’s a lot of polling to suggest that it is fairly popular among Canadians.”