Ottawa (Rajeev Sharma): Canada recorded a sharp increase in its monthly international trade deficit in November as merchandise exports fell steeply, led by a significant decline in metal and non-metallic product shipments, data released by Statistics Canada on Thursday showed.
The country posted a goods trade deficit of C$2.2 billion (US$1.62 billion) in November, widening sharply from an upwardly revised deficit of C$395 million in October. With the exception of September, when Canada registered a marginal surplus, the trade balance has remained in deficit since February last year, coinciding with uncertainty triggered by tariff threats from U.S. President Donald Trump.
Trump’s tariffs on steel, automotive products, aluminum and lumber have weighed heavily on key Canadian export sectors.
The release of November trade data was delayed after information on Canadian exports to the United States was unavailable due to a 43-day U.S. government shutdown between October and November, which disrupted data collection for several months.
Statistics Canada said the November deficit was primarily driven by a 24.4 per cent drop in exports of metals and non-metallic products, led by a sharp fall in shipments of unwrought gold. Large declines were recorded in exports of unwrought gold to the United Kingdom, the United States and Hong Kong.
In volume terms, total exports fell 0.9 per cent. Exports of motor vehicles and parts declined by 11.6 per cent, marking the steepest drop in that category in three years.
Imports edged lower, falling 0.1 per cent to C$66.14 billion. The slight decline was led by reduced imports of motor vehicles and parts as well as energy products.
Trade with the United States showed a mixed trend. Exports to the U.S. fell by 1.8 per cent, while imports from the U.S. dropped more sharply by 5.4 per cent. As a result, Canada’s merchandise trade surplus with the United States widened to C$6.6 billion in November from C$5.2 billion in October.
In November, Canada shipped about 68 per cent of its total exports to the United States and sourced roughly 56 per cent of its imports from its southern neighbour.
Imports from countries other than the United States rose 7.8 per cent, reaching the highest level on record, driven mainly by increased shipments from China and Germany. However, exports to non-U.S. destinations fell by 4.9 per cent, widening Canada’s trade deficit with countries other than the United States to C$8.8 billion in November from C$5.6 billion in October.
Following the data release, the Canadian dollar strengthened, rising 0.32 per cent to C$1.3511 against the U.S. dollar, or 74.03 U.S. cents. Yields on two-year Canadian government bonds slipped 0.5 basis points to 2.4192 per cent.
