OTTAWA – Statistics Canada says merchandise exports declined 1.8 per cent in April, while imports increased 1.4 per cent, pushing the trade balance with the world to a deficit of $638 million from a surplus of $766 million in March.
Exports fell to $42.8 billion, as declines in exports of energy products and metal and non-metallic mineral products were partially offset by an increase in shipments of forestry products and building and packaging materials.
Imports increased for a third consecutive month to a record $43.5 billion, with gains recorded in seven of 11 sectors, led by consumer goods.
Policy makers, including the Bank of Canada, are banking a “re-balancing” of the economy from growth led by household consumption to one led by exports and business investment.
BMO economists said this week domestic demand for goods and services appears to be contracting, an indication that consumers and governments are reining in spending while business continues to hold back spending intentions.
“It highlights the fact that we need to see better exports – we can’t rely on household consumption, residential construction, which have really been the drivers for the past few years,” BMO economist Benjamin Reitzes said.
“That isn’t going to be the case anymore. Households are carrying a lot of debt, and they’re not going to be borrowing and spending. They’re going to be spending what they earned.”
READ MORE: Canadian retailers expect to cut prices as consumers dial back spending
Still, exports to the United States edged down 0.2 per cent to $33 billion while imports climbed 0.3 per cent to $28.7 billion, reducing the trade surplus with that country to $4.3 billion from $4.4 billion in March.
Exports to countries other than the United States fell 7.0 per cent to $9.8 billion in April, while imports from those countries increased 3.5 per cent to $14.7 billion.
The trade deficit with those countries grew to $4.9 billion from $3.7 billion in March.
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