Canada's Trade Deficit Narrowed in December as Imports DeclinedGreg Quinn
Canada’s merchandise trade deficit narrowed in December as imports fell faster than exports, adding to the year’s record shortfall, government figures showed.
The deficit of C$901 million ($903 million) reported by Statistics Canada from Ottawa today was smaller than the C$1.45 billion predicted in a Bloomberg economist survey. Today’s report also lowered November’s estimated deficit to C$1.67 billion from C$1.96 billion.
Canada has recorded nine consecutive trade deficits, and the central bank has said the export recovery is the slowest since World War II, hobbled by a strong currency and inconsistent global demand. Governor Mark Carney said last month the case for raising his policy interest rate from 1 percent was “less imminent” as he cut his 2013 growth forecast.
Exports fell by 0.9 percent to C$37.6 billion in December, led by energy and automobiles. Imports fell 2.8 percent to C$38.5 billion.
The annual trade deficit was a record C$12.0 billion based on preliminary Statistics Canada figures, exceeding the previous record of C$10.8 billion in 2010.
The surplus with the U.S. narrowed to C$3.53 billion in December from C$3.84 billion a month earlier. The deficit with countries other than the U.S. narrowed to C$4.43 billion from C$5.51 billion.
The volume of exports declined 2.1 percent and import volumes fell 2.7 percent, Statistics Canada said. Volume figures adjust for price changes and can be a better indicator of how trade contributes to economic growth.