Canada's trade surplus widened to C$3.86 billion in June, the fourth straight monthly surplus, as a jump in gold shipments offset a decline in energy exports. Total exports and imports both hit record levels, while the surplus with the United States narrowed and new tariff risks loom in August.
Gold shipments push exports to a record
Canada's trade surplus widened to C$3.86 billion in June from a revised C$3.70 billion in May, Statistics Canada reported, marking the fourth consecutive monthly surplus. Exports rose 0.4% during the month, while imports increased 0.2%.
A 27.9% jump in unwrought gold exports offset a 10% decline in energy exports as oil prices fell. Higher gold shipments to the United Kingdom and increased purchases of Canadian-held gold by foreign residents also contributed to the gain in gold exports. Total exports reached a record $77.5 billion in June, the fifth consecutive monthly increase.
Energy exports slide as oil prices fall
Crude oil exports fell 11.1% in June, primarily due to lower prices, while refined petroleum exports decreased 16.9%, also largely on lower prices. Imports climbed to a record $73.6 billion, driven by an 11.7% rise in electronic and electrical equipment purchases, including a 59% surge in computers and computer peripherals tied largely to processing units imported from the United States for data centres.
A notably weaker Canadian dollar over the month also provided a modest boost to trade values, lifting export receipts while raising the Canadian-dollar cost of imports.
Trade balance with U.S. narrows amid tariff risk
Canada's trade surplus with the United States narrowed to $10 billion in June from $11.1 billion in May, while its deficit with countries other than the U.S. narrowed to $6.1 billion from $7.4 billion.
Risks to the trade outlook remain tilted to the downside, according to a report by TD Bank Financial Group. The CUSMA trade pact remains in force despite a missed July 1 renewal deadline. New Section 338 tariffs of 50% could take effect on August 19, adding a targeted shock on top of existing tariffs even as solid U.S. demand and commodity flows provide some offset.
Sources: ActionForex, Investing.com
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