OTTAWA: Canada’s merchandise trade deficit was narrower than economists forecast in November with shipments of cars and metals leading the first export gain in four months.
The deficit of C$1.99 billion ($1.41 billion) followed an October shortfall that was pared to C$2.49 billion from the initial reading of C$2.76 billion, Statistics Canada said Wednesday in Ottawa. Economists surveyed by Bloomberg forecast a November deficit of C$2.6 billion, based on the median of 15 estimates.
Exports climbed 0.4 percent to C$43.3 billion after three prior declines. Sales of motor vehicles and parts rose 5.9 percent to C$7.94 billion, followed by a 20.4 percent jump in metals ores and non-metallic minerals to C$1.77 billion, and a 5.5 percent gain in forestry products and packaging materials to C$3.45 billion.
The gains in non-energy exports are what Bank of Canada Governor Stephen Poloz is counting on to drive a recovery and fulfill his prediction the economy will return to full output by mid-2017. Falling energy sales and investment led him to cut interest rates twice last year, and crude prices now at about $36 are pressuring him to act again.
“This is still the two-speed market that everyone feared,” said Peter Hall, chief economist at Export Development Canada in Ottawa, a government financing agency.