Canada and the US have become embroiled in a tit-for-tat trade battle after American president Donald Trump imposed new tariffs on Canadian aluminum.

Mr Trump announced a ten per cent levy on the metal coming from north of the border last week during a factory visit in Ohio.

Accusing Canada of taking advantage of the US and flooding the market with cheaper products, he said the tariff would apply to unalloyed, unwrought aluminum.

A day later, Canada's deputy prime minister Chrystia Freeland said the nation will be retaliating dollar for dollar and that its own tariffs will come into effect on September 16th.

She also criticized Mr Trump's use of a proviso relating to national security in the Trade Expansion Act to trigger the tariffs.

"At a time when we are fighting a global pandemic ... a trade dispute is the last thing anyone needs - it will only hurt the economic recovery on both sides of the border," Ms Freeland told a news conference.

The US imposed a ten per cent levy on Canadian aluminum in June 2018, but this was ultimately revoked in May 2019 as the two nations negotiated the United States-Mexico-Canada Agreement.