- Douglas Porter, BMO Financial Group
Canada's trade deficit rose less than expected in January, as imports increased slightly more than exports, according to Statistics Canada. Canada's trade deficit edged up to C$655 million in January from C$631 million in the preceding month. Analysts, however, had expected a trade gap of C$1.05 billion. January marked the 17th straight monthly trade deficit, reflecting the ongoing economic damage caused by low oil prices. Canada's exports increased for the third month in a row, rising by 1.0% to a record C$46.00 billion amid higher shipments of consumer goods and motor vehicles and parts. Export volumes advanced 3.6% while prices declined by 2.5%. Meanwhile, imports surged 1.1% to C$46.65 billion as nine of 11 sections increased, with gains in motor vehicles and other parts being offset by a drop in aircraft and other transportation and parts. Volumes expanded by 1.6%, while prices declined 0.5%.
At the same time, exports to the US, which make up 76.0% of Canada's global total in January, climbed by 2.6%, while imports grew by 1.1%. As a result, Canada's trade surplus with the US grew to C$3.70 billion from C$3.13 billion in December.
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