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August 07, 2020

Canada’s trade deficit widens to $3.2 billion in June

Statistics Canada announced that the country’s merchandise trade deficit with the world widened from $1.3 billion in May to $3.2 billion in June.

The Federal agency says that merchandise imports and exports rebounded sharply, compared to May, mostly on the strength of motor vehicles and parts. Imports rose 21.8% and exports were up 17.1%.

However, compared with February 2020, the month before the pandemic’s economic impact was felt in Canada, imports were still down 14.3% and exports decreased 17.9%.

Total imports rose to $42.9 billion. After posting a low of $1.7 billion in May, imports of motor vehicles and parts totalled $5.2 billion in June. This increase represents almost half of the growth in total imports in June. Imports of aircraft and other transportation equipment and parts nearly doubled to $2.1 billion.

Exports rose to $39.7 billion in June. As with imports, motor vehicles and parts contributed the most to the overall increase in exports, rising from $1.9 billion in May to $6.1 billion in June. Exports of metal and non-metallic mineral products rose 17.4%.

On a global perspective, Canada’s trade deficit with countries other than the United States widened from $3.3 billion in May to $4.3 billion in June.

Following a 13.0% decrease in May, imports from those countries rose 13.0% to $16.5 billion in June. Imports from Mexico (motor vehicles and parts), Belgium (parts for other transportation equipment) and Germany (passenger cars and light trucks) contributed the most to the increase. Exports to countries other than the United States were up 7.8% to $12.2 billion, led by higher exports to the United Kingdom (refined gold).

Imports from the United States increased 28.0% to $26.4 billion in June, partly on imports of motor vehicles and parts. However, imports from the United States were down 19.3% compared with February.

Exports to the United States rose 21.8% to $27.5 billion in June, mainly on exports of motor vehicles and parts. However, exports to the United States were down 23.9% from February. As a result, Canada’s trade surplus with the United States narrowed from $1.9 billion in May to $1.1 billion in June.

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