Canada Trade Deficit Narrows in March


Canada’s merchandise trade deficit narrowed to CAD 3.21 billion in March 2019 from an upwardly revised CAD 3.42 billion in the previous month and compared with market expectations of a CAD 2.45 billion gap. Exports rose 3.2 percent month-over-month, mainly due to higher sales of energy products and imports advanced at a softer 2.5 percent mostly driven by purchases of consumer goods.

Exports rose 3.2 percent month-over-month to CAD 49 billion in March from a downwardly revised CAD 47.54 billion in February and below market consensus of CAD 48 billion. Sales of energy products increased 7.7 percent to CAD 9.6 billion, driven by crude oil (5.0 percent), coal (29.5 percent), natural gas (9.9 percent) and refined petroleum products (13.6 percent). Also, sales of motor vehicles and parts went up 5.6 percent, namely passenger cars and light trucks (8.4 percent) and motor vehicle engines and motor vehicle parts (4.6 percent).

Exports to the US advanced 1.3 percent to CAD 36.4 billion, mostly on higher sales of motor vehicles and crude oil. Exports to countries other than the US rose 8.8 percent to CAD 12.7 billion, as higher exports to the UK (gold), the Netherlands (aluminium and crude oil), Germany (aircraft and crude oil) and Saudi Arabia (other transportation equipment) were partially offset by lower exports to Hong Kong (gold).

Imports increased 2.5 percent to CAD 52.26 billion in March 2019, from an upwardly revised CAD 50.96 billion in February and against market expectations of CAD 51.5 billion. Purchases of consumer goods went up 6.7 percent to a record CAD 10.9 billion, boosted by clothing, footwear and accessories (22.9 percent) mainly on higher purchases of clothing from Bangladesh and Cambodia. Also, imports of motor vehicles and parts advanced 4.9 percent to CAD 9.9 billion, mostly due to commercial trucks. On the other hand, purchases of aircraft fell 50.7 percent due to a slowdown in deliveries of airliners from the US.

Imports from the US dropped 0.4 percent, primarily on lower imports of aircrafs while those from countries other than the US rose 8.0 percent to CAD 19.5 million, led by higher purchases from China (computers and peripherals) and Mexico (cars and trucks).

Considering the first quarter of the year, the country's trade gap widened to CAD 10.4 billion from CAD 7.8 billion in the same period of 2018, the largest trade gap since the second quarter of 2016. Imports in the first quarter of 2019 went up 2.2 percent to CAD 155.1 billion, driven by higher purchases of aircraft and other transportation equipment and parts (35.0 percent) and motor vehicles and parts (4.9 percent). Exports advanced 0.5 percent to CAD 144.7 billion, boosted by sales of energy products.

Canada Trade Deficit Narrows in March


Statistics Canada | Stefanie Moya | stefanie.moya@tradingeconomics.com
5/9/2019 1:08:59 PM