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Canada's Trade Deficit Widened in November

ByThe National Bank of Canada
Published 01/30/2012, 01:47 AM
Updated 05/14/2017, 06:45 AM
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FACTS:

The Institut de la statistique du Québec reports that Quebec’s trade deficit widened $472 million in November to $1.71 billion (top chart). The value of exports fell $263 million (or 4.6%) to $5.4 billion, with declines reported in 13 of 23 broad categories of goods accounting for 67% of total exports. However, 80% of the decrease was in aerospace products (−$210 million). Imports rose $209 million (or 3.0%), with increases in 10 of 24 main categories accounting for 52% of all imports. However, 84% of the rise was in crude oil (+$176 million). A sharp rise in imports of chemicals (+$104 million) was offset by a drop in nonferrous metals (−$97 million). In constant dollars the trade deficit widened $380 million to $1.93 billion. Exports fell $316 million, or 5.9%, to $5.02 billion. Imports rose $64 million, or 0.9%, to $6.95 billion. Export prices rose 1.4% and import prices rose 2.1%, led by crude oil.

OPINION: The November decline of exports was due essentially to aerospace products, whose exports had spiked in October. Exports in Q4 to date have nevertheless continued the rise that began in Q3. Over the last five months this export growth has made up part of the lag relative to Canada as a whole that had accumulated since early 2010 (middle chart). In volume terms, meanwhile, the Q4 trade deficit two months into the quarter is on track to narrow from Q3, meaning that international trade is contributing to economic growth. Thus the report on international trade, like those for retail sales, housing starts and small-business confidence, fails to corroborate the dramatic loss of jobs that Statistics Canada reported for Quebec in Q4.

Quebec Nominal trade balance

International merchandise exports

Quebec Volume trade balance

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