- CIBC World Markets
Canada logged near record trade deficit in April, when both imports and exports dropped in another sign of challenges facing the economy, Statistics Canada data showed. The country's trade deficit, the seventh in a row, came in at C$2.97 billion, whereas analysts had expected a shortfall of C$2.10 billion. The deficit was the second largest in history after the C$3.85 billion recorded in March.
Canada is a major energy exporter and the nation's economy has been severely derailed by plunging oil prices. Imports declined by 2.5% on lower shipments of consumer goods and metal and non-metallic products. At the same time, exports dropped by 0.7%, the fourth consecutive monthly decline, pulled down partly by a 6.0% plunge in consumer goods. The value of energy product exports rose by 5.9% as an 8.3% rise in volumes offset a 2.2% drop in prices. Statistics Canada also reported that the trade surplus with Canada's biggest trading partner, the US, rose to C$2.4 billion in April, as imports plunged 1% and exports climbed 1.6%. In contrast, Canada's trade gap with countries other than the US slightly shrank to C$5.4 billion. Meanwhile, the Bank of Canada's kept its interest rate unchanged at 0.75% for a third consecutive meeting earlier this week, underscoring that growth and inflation are in line with expectations.
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