Canada’s merchandise trade surplus widened by more than expected in October, led by exports of consumer goods, canola and wheat.
The surplus rose to $1.2 billion, from a downwardly revised $607 million in September, Statistics Canada reported Tuesday in Ottawa. Economists were anticipating exports to exceed imports by $900 million in October.
Total exports rose 1.5 per cent, while total imports increased 0.6 per cent on the month, led by passenger cars and light trucks, which saw higher import values as the loonie fell.
The data show international demand for Canada’s exports remains solid, even amid higher prices and mounting global economic headwinds. Exports of canola jumped 73.8 per cent and wheat were up 18 per cent, after elevated production made larger quantities available for shipping.
The international trade sector could still be one bright spot in the economy at the beginning of the final quarter, offsetting some weakness in household consumption and business investment as the country’s output is set to stall in coming quarters.
Waning economic momentum has made the magnitude of the Bank of Canada’s next interest-rate increase, due Wednesday, an open question. A slim majority of economists expect a 50-basis-point hike, while markets are leaning toward a 25-basis-point move.
Stripping away the impact of prices, Canada exports rose 0.1 per cent, while imports fell 0.9 per cent.
Canada’s exports to China sharply rose 25.4 per cent to a record-high $3.3 billion, driven by higher exports of canola, oilseeds and wheat.
After four consecutive monthly decreases, Canada’s trade surplus with the U.S. widened to $10 billion in October, from $9.3 billion in September.