Canada's June Trade Surplus Widens

Canada's trade surplus widened for a second straight month in June as exports of energy products such as crude petroleum and natural gas surged while car shipments rebounded.

The surplus widened to C$5.76 billion ($5.38 billion) from a revised C$5.22 billion in May, Statistics Canada said today in Ottawa. Exports and imports both rose to records in June, gaining 3.1 percent and 2 percent respectively, and the trade surplus with the U.S. was the widest since January 2006.

The report shows Canada's international trade continues to be supported by sales of commodities and may not be as much of a drag on economic growth as the Bank of Canada predicted in July. Policy makers said last month that a persistent export slump would cause the slowest expansion since 1992 when Canada had its last recession.

The central bank left interest rates unchanged for a second straight meeting on July 15, saying the economy will expand 1 percent this year as trade cuts growth by 1.9 percentage points.

Exports rose for a sixth straight month to C$43.2 billion as Canada boosted shipments to the U.S. by 5.3 percent. Sales abroad of cars and automotive products gained 7.7 percent, the first increase in four months, to C$5.28 billion.

Imports increased to C$37.4 billion in June as purchases of energy from overseas gained 18 percent. Imports of automotive products rose 7.4 percent to C$6.34 billion. Measured by volume, exports fell 1.4 percent and imports dropped 0.6 percent, the statistics agency said.  The trade surplus with the U.S. widened to C$9.63 billion.

Canada, Bloomberg
8/12/2008 6:54:01 AM