‘The Bank of Canada has been looking for that for the length of 2016 but has been largely disappointed, but maybe it is starting to materialise as we move into 2017.’ – Paul Ferley, Royal Bank of Canada
The Canadian trade deficit narrowed in April but less than expected, as imports growth offset exports growth. Statistics Canada reported on Friday that country’s trade gap narrowed to C$0.4B in April, following the previous month’s deficit of C$0.9B. Meanwhile, analysts anticipated a shortfall of just C$70M. Canadian exports advanced 1.8% in April to C$47.7B, compared to March’s gain of 3.2%. Shipments of motor vehicles and parts climbed 4.4%, whereas exports of energy rose 2.5%. Canadian imports rose for the fifth consecutive month in April, posting a 0.6% gain to C$48.1B amid higher shipments of consumer goods, electronic and electrical equipment and parts. Exports to the country’s southern neighbour, the United States, which accounted for 75.7% of all exports in April, surged 5.4%, whereas imports rose just 1.1%. Thus, the Canadian trade surplus with the US rose to C$5.0B, the biggest since May 2014, from March’s C$3.4B. Separately, Statistics Canada reported that the labour productivity of businesses increased 1.4% in the March quarter.
