The surplus shrank to C$4.85 billion ($4.52 billion) from a revised C$5.64 billion in June, Statistics Canada said today in Ottawa. Imports rose 4.6 percent, the fourth straight gain, and exports increased 2.2 percent. Economists predicted the surplus would narrow to C$5.6 billion, the median of 17 estimates.
The report indicates high commodity prices are helping Canadian companies and consumers buy goods from abroad at a faster rate than in the U.S. The trade surplus with the U.S. narrowed to C$8.88 billion from C$9.73 billion, as demand in that country continues to be hobbled by a persistent housing slump, job losses and high energy costs.
Canada's import gain was led by a 9.5 percent jump in automotive products, mostly new cars, Statistics Canada said. Orders of parts for crude oil pipelines and underwater power cables lifted industrial goods imports by 6.1 percent, and shipments of excavating gear helped boost machinery and equipment imports by 2.9 percent.
On the export side, industrial goods rose 5 percent in July, led by shipments of nickel and fertilizers. Machinery and equipment exports rose 6.6 percent.
Separately today , Statistics Canada said new-home prices increased 2.7 percent from July 2007, slowing for a sixth straight month. From June, prices rose 0.1 percent, matching economists' expectations.