Canada’s Trade Deficit Exceeds Forecasts

Canada’s merchandise trade deficit widened for a third month in December, exceeding all economist forecasts, as imports led by energy reached a record high.  The deficit of C$1.66 billion ($1.50 billion) followed a November shortfall that was revised to C$1.53 billion from C$940 million, Statistics Canada said today in Ottawa. Economists surveyed by Bloomberg forecast a C$650 million deficit in December, based on the median of 18 forecasts.

Imports rose 1.2 percent to a record C$41.4 billion as energy shipments jumped 22.6 percent to C$3.95 billion, Statistics Canada said. Exports rose 0.9 percent to C$39.7 billion, as a 4.5 percent decline in energy was offset by gains that included a 19.5 percent rise in metal ores.

Canada’s dollar fell to four-year lows last month after the country’s central bank suggested it may cut its 1 percent policy interest rate because of weak exports and inflation. Bank of Canada Governor Stephen Poloz said an expected surge in foreign demand and business investment hasn’t materialized.

Bloomberg

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.