OTTAWA – Statistics Canada says the country’s trade deficit with the world increased to $2.5 billion in August as exports fell due to a sharp drop in oil prices.
The gap between what Canada sold abroad versus the value of good brought into the country was wider than expected. Economists had expected a deficit of $1.2 billion for the month, according to Thomson Reuters.
Experts say the economy desperately needs a “rotation” from consumer-led growth to manufacturers and exporters over the next several years as households confront record debt levels.
“Trade took a step back in August,” Nick Exarhos, and economist at CIBC, said.
On the other side of the trade equation, imports of consumer goods increased 2.6 per cent to $10.0 billion.
The result for August came as exports fell 3.6 per cent in the month to $44 billion, while imports edged up 0.2 per cent to $46.5 billion.
Exports in the energy sector fell 14.7 per cent to $6.3 billion, due to a 20.9 per cent drop in crude oil and crude bitumen. For the group as a whole, prices fell 16.4 per cent while volumes increased 2.0 per cent.
More in, less out
Consumer goods exports dropped 8.0 per cent to $5.9 billion on lower volumes, while metals and non-metallic mineral products fell 9.7% to $4.5 billion.
However, exports of motor vehicles and parts rose 3.1 per cent to $7.8 billion due to a 4.5 per cent increase in exports of passenger cars and light trucks.
In August, exports to the United States fell 3.0 per cent to $33.7 billion while imports from the U.S. slipped 0.8 per cent to $30.8 billion.
Exports to countries other than the United States fell 5.5 per cent to $10.2 billion, while imports from countries other than the U.S. increased 2.2 per cent to $15.6 billion.