Canada Trade Surplus Narrows


Canada's trade surplus narrowed more than anticipated in September, as imports increased while prices for energy and metal exports fell.

The surplus shrank to C$4.49 billion ($3.65 billion), the lowest since January, less than the C$4.8 billion forecast in a Bloomberg survey of 19 economists. Ottawa-based Statistics Canada also reduced its estimate of the August surplus to C$5.63 billion from an initial reading of C$5.8 billion.

Canada will follow other industrialized countries into a recession, according to economists surveyed this month by Bloomberg News. Weaker global conditions are eroding demand for the commodities that make up half of Canada's exports, as a U.S. recession stalls orders of factory goods such as automobiles.

Exports fell 1 percent in September to C$42.5 billion as car and truck shipments fell 3.4 percent, the eighth decline for the auto sector in the past 12 months. Energy shipments abroad fell 1.4 percent and exports of industrial goods declined 1.9 percent on lower prices, Statistics Canada said.

Finance Minister Jim Flaherty said yesterday he's considering aid for automakers facing the worst market in 25 years. The U.S. Congress has already passed a $25 billion aid package for General Motors Corp., Ford Motor Co. and Chrysler LLC. The plants those companies have in the province of Ontario and are among Canada's biggest private-sector employers.

Canada's imports rose 1.9 percent to C$38 billion, the fifth gain in six months. Energy imports rose 10 percent and automobile imports rose 2 percent.

Canada's trade balance with the U.S. narrowed to C$8.33 billion from C$8.72 billion in August.


TradingEconomics.com, Bloomberg.com
11/13/2008 6:05:58 AM