Canada June trade deficit soars on higher imports

Thu Aug 9, 2012 8:50am EDT
 
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OTTAWA (Reuters) - Canada's trade deficit unexpectedly soared to C$1.81 billion ($1.83 billion) in June from a revised C$954 billion in May as imports hit a record high while exports barely edged up, Statistics Canada data showed on Thursday.

The data confirm that Canada -- heavily reliant on trade -- is suffering as Europe's economic crisis shows no sign of ending and the U.S. economy struggles. Markets had expected a June deficit of C$1.00 billion.

The June deficit was the largest since the C$2.31 billion recorded in September 2010.

Imports jumped by 2.3 percent to a new high of C$40.90 billion -- eclipsing May's figure of C$39.98 billion -- on shipments of machinery and equipment. It was the seventh consecutive month-on-month advance.

Exports increased by just 0.2 percent, as a 13.9 percent jump in exports of automotive products was largely wiped out by a 3.5 percent drop in exports of energy products.

Exports to the United States -- which took 74.1 percent of all Canadian exports in June -- increased by 2.2 percent, while imports of U.S. goods grew by 3.0 percent. As a result, Canada's surplus with the United States dropped to a 10-month low of C$2.70 billion.

(Reporting by David Ljunggren; editing by John Wallace)