- Peter Hall, Export Development Canada
The Canadian trade balance remained in the positive territory for the third consecutive month in January, the longest streak since 2014, suggesting the economy regained momentum after the oil price collapse. Statistics Canada reported on Tuesday that the country's trade surplus hit C$0.8 billion, while analysts expected January's surplus to come in at C$0.2 billion. Meanwhile, December's originally reported trade surplus of C$0.9 billion was revised down to C$0.4 billion. Data showed exports advanced 0.5% in January, while imports fell 0.3%. In volume terms, exports and imports rose 1.0% and 2.5%, respectively. After the release, the Canadian Dollar rose slightly against its US counterpart, trading at C$1.3406. Back in the Q4 of 2016, the Canadian economy expanded at a stronger than expected pace, driven by higher household spending and lower imports. However, despite the economy's strong performance, the Bank of Canada left its key interest rate unchanged at its last policy meeting on March 1, pointing to significant uncertainties in the Canadian economy. Other data released on Tuesday showed the Ivey PMI dropped to 55.0 last month, after hitting 56.4 in the previous month. February's decline was mainly driven by lower material prices. However, the Employment Index climbed to 54.5 from 53.5 in January.
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