Canada runs large trade deficit as economy keeps spluttering on
By David Ljunggren
OTTAWA (Reuters) - Canada ran a near-record trade deficit of C$2.94 billion ($2.28 billion) in April as the economy continued to struggle with weak crude oil prices that have slashed the value of exports and curbed growth.
The deficit, announced by Statistics Canada on Friday, was the 20th in a row and greater than the C$2.45 billion shortfall forecast by analysts in a Reuters poll. March's revised deficit of C$3.18 billion is the record.
The shortfall narrowed from the previous month as exports rose 1.5 percent from March on a slight recovery in oil prices and increased natural gas shipments to the United States. Volumes rose by 0.5 percent while prices grew by 1.1 percent.
Imports increased 0.9 percent on the month on aircraft and other transportation equipment.
"The volume increase in exports was slightly underwhelming and I think we will be downgrading what we are expecting out of April gross domestic product," said Nick Exarhos, economist at CIBC Capital Markets.
Exarhos, speaking by phone, said he had initially been looking for a 0.3 percent boost in growth in April after the economy shrank by 0.2 percent in March.
Exports to the United States, which accounted for 74.8 percent of Canada's global total in April, rose 2.3 percent while imports advanced by 3.0 percent.
As a result, Canada's trade surplus with its neighbor to the south narrowed to C$1.57 billion from C$1.74 billion in March, the lowest surplus since December 1993. Continued...