- Benjamin Reitzes, senior economist at BMO Capital Markets
Just like its neighbour, Canada also surprised markets with substantially better than initially expected trade data, as the country saw its trade surplus jumping to the highest level in more than two years, supported by exports, which hit the record high. According to Statistics Canada, country's trade surplus came in at $1.9 billion in June compared with a revised $576 million in the preceding month. Exports soared 1.1% to all-time high of $45.2 billion amid strong energy sector's exported products, which surged 2.5% to $11.9. The mining sector was also a top performer. Exports to the United States, Canada's main trading partner, remained unchanged at $34.1 billion in June, while imports rose 1.5% to $29.1 billion, a record high. The Bank of Canada expects that Canada will benefit from U.S. strong economic performance, as 75% of all exports head to the United States. The central bank has been keeping its benchmark interest rate unchanged at close to the record low since September 2010, saying that there will be no interest rate hike until the sustained recovery, particularly in the non-energy sector, is observed.
The Loonie strengthened on the back of positive data, with USD/CAD trading at 1.0946 losing 0.13%. The Greenback, however, also was supported by a similarly strong trade data from the U.S.
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