- Krishen Rangasamy, National Bank senior economist
Canada's wholesale trade rose for a second consecutive month in April, beating economists' projections more than six times. Wholesale trade recorded strong gains in the reported month, which were attributed to a rebound in the automobile sector. According to Statistics Canada, the gauge jumped by 1.9% to C$55.2 billion in April, compared with a 0.3% forecast. The biggest upside contributor behind the strong monthly gains was the motor vehicle and parts subsector, which increased 9.3% and stood 16.3% over a year earlier. Excluding the auto sector, wholesale trade was up only 0.4%. Additionally, wholesale inventories broke the previous record by climbing 0.5% to C$71.8 billion, largely due to the machinery, equipment and supplies as well as food, beverage and tobacco subsectors.
Other GDP-related data included Canadian manufacturing orders, which declined more than expected in April, largely dragged down by lower sales of food and aerospace products. Sales dropped 2.1% to C$49.8 billion. Another weak spot this month was Canada's trade deficit, which shrank on higher energy exports in April, but missed expectations, recording the second highest gap on record. Imports fell 2.5% and exports ticked down 0.7% during the month, leading to a C$3 billion deficit, the seventh in a row. Canada's GDP growth disappointed in the first quarter, falling 0.6% on year, as the oil-price shock limited Canada's growth potential.
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