UPDATE 1-Canada Q3 current account deficit shrinks to C$8.40 billion

Thu Nov 27, 2014 8:32am EST
 
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(Adds data, background)

OTTAWA Nov 27 (Reuters) - Canada's current account deficit in the third quarter unexpectedly narrowed to C$8.40 billion ($7.43 billion), its best performance in six years, Statistics Canada data indicated on Thursday.

Market operators had forecast a deficit of C$11.10 billion. Statscan revised the second quarter deficit to C$9.91 billion from an initial C$11.87 billion.

The data were the latest in a string of figures suggesting the Canadian economy is starting to pick up speed after a period of sluggish growth.

Canada posted a C$3.97 billion current account surplus in the third quarter of 2008 and then recorded a series of deficits larger than the C$8.40 billion seen in the third quarter of 2014.

The biggest move in the third quarter was a growth in the surplus on the trade in goods to C$2.90 billion from C$2.33 billion in the second quarter. It was the third straight surplus after eight quarters of deficits.

The deficit on cross-border investment income flows dropped to C$4.76 billion from C$5.14 billion as profits earned abroad by Canadian direct investors grew more than those earned in Canada by foreign direct investors.

($1=$1.13 Canadian) (Reporting by David Ljunggren; editing by Randall Palmer and W Simon)