Canada trade deficit shrinks to six-month low, exports at record high

OTTAWA (Reuters) - Canada’s trade deficit in April shrank to a six-month low of C$1.90 billion ($1.47 billion), from C$3.93 billion in March, as exports climbed to a record high and imports dropped, Statistics Canada said on Wednesday.

The shortfall - considerably less than the C$3.40 billion deficit forecast by analysts in a Reuters poll - was the smallest since a C$1.49 billion gap recorded in October 2017. Canada has only recorded two monthly trade surpluses since October 2014.

Exports increased 1.6 percent - the sixth gain in seven months - to C$48.56 billion, on higher shipments of metal and non-metallic mineral products, consumer goods and energy products.

Imports, which had marked a new high in March, dipped by 2.5 percent to C$50.47 billion as imports of motor vehicle and parts dipped by 5.8 percent after two months of strong increases.

The data underscored the continued importance of the giant U.S. market, which took 74.3 percent of all Canadian goods exports in April. The Bank of Canada repeatedly cites uncertainty over the future of the North American Free Trade Agreement as a risk factor for the economy.

Exports to the United States rose 3.2 percent while imports dropped by 1.4 percent. As a result, the trade surplus with the United States grew to C$3.63 billion in April from C$2.03 billion in March.