In December, Canada’s international merchandise trade deficit saw a significant reduction as exports accelerated at a faster rate than imports, according to Statistics Canada data released on Thursday. Notably, the share of exports directed to the United States fell to unprecedented levels, excluding COVID-19 months.
The December trade figures revealed a C$1.31 billion ($957 million) deficit, a stark contrast to the adjusted C$2.59 billion deficit recorded in November. Economists had anticipated a deficit closer to C$2 billion for December. The increased export activity was primarily influenced by a surge in metals and non-metallic mineral product shipments, most prominently seen in a 37% rise in unwrought gold exports, spurred by escalating prices.
Although Canadian exports to the United States, its largest trade partner, grew by 1.1%, they accounted for just over 67.4% of total exports, a considerable decline from 76.2% a year prior. Exports to countries beyond the U.S. reached record levels, driven by gold exports to the United Kingdom, despite a 3% fall in imports from these regions. This helped reduce Canada’s trade deficit with non-U.S. countries by $2 billion from November.
(With inputs from agencies.)