Canada’s merchandise trade deficit with the world narrowed slightly in from $1.2 billion in September to $1.1 billion in October, says Statistics Canada.
The federal agency reported Thursday that exports rose 0.8 per cent in October while imports increased 0.5 per cent, mainly on higher imports of energy products.
“Exports of energy products (+3.4 per cent) also rose in October, mostly on higher exports of crude oil (+2.7 per cent) and refined petroleum products (+15.2 per cent). After falling in September on lower volumes, crude oil exports rebounded in October as the effect of higher prices more than compensated for a decrease in volumes. Exports of refined petroleum products were up in October mainly on higher exports of fuel oils and diesel to the United States,” said StatsCan.
“Imports of energy products were up 8.9 per cent in October, mainly on higher imports of crude oil and crude bitumen (+8.5 per cent), which increased largely due to higher prices. This was the eighth monthly increase for imports of crude oil in 2019. Imports of natural gas (+46.2 per cent) and refined petroleum products (+6.8 per cent) also contributed to the increase in energy product imports in October.”
Omar Abdelrahman, Economist with TD Economics, said October’s trade report was decent, but does little to change the narrative of a soft export backdrop in the second half of 2019.
“It is important to highlight that driving this month’s increase in exports are one-off transactions that could be partially reversed,” he wrote in a commentary note.
“Against lingering trade uncertainty and subdued global trade volumes, net trade is unlikely to be a meaningful growth contributor in the near term. The fact that manufacturing sentiment remains in contractionary territory south of the border, means that previous pockets of solid demand may not provide as much support in the months ahead.”