UPDATE 2-Lower Canada imports in October reflect weak economy

Tue Dec 11, 2012 11:12am EST
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

* Canada exports up by 1.0 pct, imports down by 1.2 pct

* Imports drop to 15-month low, volumes also down

* Figures suggest growth will stay sluggish: economists

By David Ljunggren

OTTAWA, Dec 11 (Reuters) - Canada's trade deficit came in much smaller than forecast in October as imports fell to a 15-month low, a sign the economy is still struggling to cope with weak foreign markets and other challenges.

Statistics Canada said on Tuesday that the deficit fell to C$169 million ($171 million) from a revised C$1.01 billion in September. Market operators had expected a C$1.20 billion shortfall.

Imports dropped by 1.2 percent to C$38.28 billion, the lowest level since the C$37.58 billion recorded in July 2011 and 5.7 percent under the record high of C$40.60 billion in June 2012. Most sectors posted declines and volumes decreased by 1.8 percent.

"The key in this report is what it says about broadly based import weakness as a reflection of the very soft Canadian economy over the second half of 2012," Toronto-Dominion Bank economist Derek Burleton said in a note to clients.

Canada's economy grew at a tepid 0.6 percent pace, annualized, in the third quarter, in large part because of weaker exports. Canadian exporters are struggling to cope with the European crisis, uncertainty over the U.S. "fiscal cliff" and a strong Canadian dollar.   Continued...