Canada posted a trade deficit in August of 2.53 billion Canadian dollars ($1.94 billion), Statistics Canada said Tuesday.
Advertisement
The wider deficit was partly due to a decrease in the value of exports, which fell by 2 percent to $185.1 billion in August from $188.8 billion in July. Imports of capital goods, excluding cars, rose $1.1 billion, reflecting gains in telecommunications equipment and generators.
“With a falling currency and export volumes doing OK, it should have been better but imports haven’t slowed down”. This puts the onus on US consumers to deliver stronger economic growth because the rest of the world will probably be a drag. August petroleum imports were the lowest since September 2004, while the export value of industrial supplies including oil was the smallest since October 2010.
So far this year, the deficit is running at an annual rate of $531.6 billion, 4.6 percent higher than last year’s deficit of $508.3 billion. But the Obama administration will face a major challenge winning congressional approval for the Trans Pacific Partnership trade deal against opponents who argue that the agreement will expose American workers to more unfair foreign competition.
A 3 percent increase in imports from China also factored into the widening of the trade deficit.
Mr Kennedy said that the surprise in the data was with nominal exports, which fell 0.5 per cent. “We had expected a 1 per cent increase”, he said.
“The lower Australian dollar should keep encouraging export growth away from the sloganistic “iron ore to China” and towards more broad-based export growth”.
Advertisement
Exports were roughly flat on month, dipping A$130 million to A$26.509 billion.
