MNI: Canada Sept Trade Gap Unchanged, 3Q Deteriorates Sharply>

By Courtney Tower 

     OTTAWA (MNI) - Canadian goods trade balance was unchanged in 

September from August this year, with a deficit of C$3.2 billion with 

the world, and was down sharply in the third quarter, all largely on 

weaker car and light truck sales to the United States, Statistics Canada 

reported Friday. 

     The September result was slightly weaker than expected by analysts 

in an MNI survey, who foresaw a C$3.0 billion deficit on the month.

     For September, exports were down 0.3% on lower passenger car and 

light truck exports. Imports were down the same 0.3%, on lower prices. 

The decrease in September exports was the fourth consecutive monthly 

decline since a record high in May. 

     Exports of motor vehicles and parts fell 10.6% in the month and 

were down 17.2% year-over-year. This decline in September to the lowest  

level since February 2015, was largely offset by energy products rising 

7.2% on the month, and 25.7% on the year. Exports of passengers cars and 

light trucks were the main negative factor in the sector, falling 15.6%. 

     Work stoppages in the automotive industry were said to be 

responsible for the decline in September, and "changes to certain models 

for the American market." 

     Exports to the United States fell 1.2% in September on the lower 

sales of cars and light trucks, while imports from the U.S. rose 0.4%. 

Canada's trade surplus with the United States, then, narrowed from C$2.7 

billion in August to C$$2.2 billion in September. 

     Canada's third quarter deficit with the world sharply increased to 

C$9.4 billion from C$5.5 billion in the second quarter. 

     A factor in the export declines was the rise in strength of the 

Canadian dollar, by 5.5 US cents in the third quarter and by 2.1 US 

cents in September. 

     After four straight quarterly gains, exports fell 7.9% to C$131.2 

billion in the third quarter this year, the largest decrease since the 

second quarter of 2009. "Motor vehicles and parts contributed the most 

to the decline," Statistics Canada said. Imports were down 4.9% in the 

third quarter, on widespread declines throughout sectors. 

     The drop of 7.9% in nominal exports compared with a gain of 2.7% in 

the second quarter. The drop of 4.9% in nominal imports compared with an 

increase of 5.1% in the second quarter. 

     Export prices fell 4.8% in the quarter (+0.3% in the second) and 

import prices declined 4.6%, the largest drop since the second quarter 

of 2003, versus a gain of 2.0% in the second quarter. 

     Real exports declined 3.2% in the third quarter, after a gain of 

2.4% in the second, mainly on lower exports of motor vehicles and parts. 

Real imports edged down 0.2% in the third quarter. 

     Canada's real trade balance deteriorated sharply in the third 

quarter, to a C$3.4 billion deficit from a C$0.3 billion surplus in the 

second. 

     In September, the 0.3% decline in imports was led by a 4.6% decline  

in electronic and electrical equipment. Imports of consumer goods fell 

1.9%, a fifth straight monthly decline. 

     Canada's trade deficit with countries other than the United States 

improved slightly, to -C$5.3 billion from -C$5.8 billion in August. 

 --MNI Ottawa Bureau; email:yali.ndiaye@marketnews.com 

     [TOPICS: M$C$$$,MACDS$]