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Canada slips back into trade deficit

Published by Steve Coleman on December 09, 2011

Canada was back to running a trade deficit in October after posting the year's first surplus a month earlier.

Exporters sent out three per cent fewer goods with the Made in Canada label in October, while imports rose 1.9 per cent during the month.

As a result of the decline, Canada's trade balance went from a $1 billion surplus in September to an $885 million deficit in October.

Most of the trade surpluses in the previous three months were due to higher goods prices. Both prices and volumes fell in October. Statistics Canada says automotive products were the only sector to show an increase for the month.

Imports reached into record territory with a high-water mark of $39.3 billion for the month, as volumes rose 1.3 per cent. Imported machinery and equipment led the overall increase, followed by energy and automotive products.

Even Canada's trade balance with the United States fell for the month after the amount of American imports increase three per cent to $24.5 billion, the highest value since October 2008, while exports fell 0.9% to $27.6 billion. It was enough to push the dollar value of trades with the US down7.9 per cent to $10.8 billion.

Exports to countries other than the United States fell even harder during the month. Exporters sold 7.9 per cent fewer goods, pushing the amount down to $10.8 billion. Meanwhile, countries other than the US sold Canadian $13.7 billion worth of goods, up 0.1 per cent.

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