Invest in Canada

Canada’s trade surplus weakens

by investor on 13/01/09 at 12:57 pm

Plunging commodities markets pummeled Canada’s trade surplus to a slim $1.3-billion in November, with both exports and imports on the decline, Statistics Canada says.

Analysts had been expecting that lower commodity prices in November and a pullback in U.S. demand would slash the trade surplus to $3-billion, down from $3.8-billion in October. Statistics Canada revised its October surplus number to $2.3-billion because of new information about the effect of energy prices and volumes.

The November surplus of $1.3-billion is the smallest since October 1997, and analysts warn that Canada is quickly heading to the land of dual deficits – both for the current account and the fiscal situation.

Exports sank 6.8 per cent to $39.2-billion – the fourth month in a row for a decline, as a result of falling prices as well as falling volumes. Exports were at their lowest level since January 2008, Statscan said.

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