By Robb M. Stewart
OTTAWA–Canada’s goods-trade surplus with the rest of the world widened in October to the largest since the middle of last year as exports ticked up but imports were in part dragged down by supply disruptions with U.S. auto strikes.
The country posted a merchandise-trade surplus of 2.97 billion Canadian dollars, the equivalent of about $2.18 billion, Statistics Canada said Wednesday.
The country has notched a trade surplus for three months running, though September’s was revised down by C$917 million to C$1.12 billion.
Merchandise exports edged up 0.1% to C$65.98 billion in the latest month, a fourth straight monthly rise, while imports fell 2.8% to C$63.01 billion, the data agency said.
Exports to the U.S., Canada’s biggest export market by a wide margin, declined 1% after rising the previous three months, while imports from the U.S. were 3.9% lower. That widened Canada’s surplus with its neighbor for a fourth consecutive month, to C$12.09 billion from C$11 billion the month before.
Exports to countries other than the U.S. rose 3.9% from the month before, while imports declined.
The rise in global exports was driven by a jump in shipments of aircraft and transportation equipment, thank to higher exports of such equipment to Saudi Arabia.
Exports of energy products were down 1.2% for the month with a drop in crude oil shipments, which were up strongly in the third quarter of the year. Stripping out energy products, exports for the month were up 0.5% from September.
Imports of metal and mineral products fell sharply, largely thanks to a drop in imports of unwrought precious metals driven by a decline in gold transfers in the banking sector.
Imports of motor vehicles and parts were down 5.8%, the first decline in seven months with unstable supply caused by the labor strikes at U.S. automakers as well as lower imports from Mexico. Despite the monthly fall, imports of vehicles and parts is up almost 21% since the start of the year against the same period last year.
On a volume, or price-adjusted, basis, exports slipped 0.1% in October while imports fell 3.2%.
When international trade in goods and international trade in services were combined, Canadian exports rose 0.1% and imports fell 2.3%. As a result, Canada’s trade surplus incorporating both goods and services swung to a surplus of C$1.69 billion in October from a C$288 million deficit the month before.
Economic output in Canada has cooled sharply in recent months under the weight of high interest rates, and the central bank projects a period of weaker growth before picking up in late 2024. Gross domestic product contracted slightly in the third quarter of the year with a drop in international exports and a slower inventory buildup by businesses.
The Bank of Canada is set to decide on interest rates Wednesday morning, and economists expect policymakers will leave the target for the overnight rate at 5%.
Write to Robb M. Stewart at [email protected]
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