$2.6 B added to current account deficit
OTTAWA: Canada’s overall current account deficit widened by $2.6 billion bringing the total to $11 billion in the second quarter, for a seventh straight quarter of deficit.
A Statistics Canada report said export growth for goods slowed while import growth remained strong, which led to a deterioration of the merchandise trade balance; and a lower deficit on non-resident investment income flows was partially offset by a higher deficit on international trade in services.
Goods trade declined $2.5 billion returning to deficit, following two quarters of surplus.
A slowdown in export growth ($1.2 billion) to the US shrank the goods surplus by $2.3 billion and put import growth ahead.
Energy products and industrial goods were the main contributors to export growth during the previous three quarters, but both declined in the second quarter.
Exports of energy products fell $1.9 billion, with prices down for all components except coal. Statistics Canada said volumes were unchanged, with lower volumes of crude petroleum offset by higher volumes of natural gas. Industrial goods exports slipped $300 million on lower volumes following a gain of $ billion over the three previous quarters.
Exports of automotive products continued to gain, rising $1.9 billion, pushing automobiles past the $10 billion mark for the first time since the second quarter of 2007.
Machinery and equipment exports were up $1.2 billion, with volumes increasing after six quarters of declines and prices advancing for the first time in five quarters.
Imports of goods increased $3.7 billion, led by machinery and equipment imports, which rose by $1.9 billion on higher volumes for all components, while prices were down for a fifth quarter.
Imports of industrial goods continued to strengthen by $1.2 billion, with half of the gains from metal and metal ores. Statistics Canada said automotive products imports edged up, as stronger imports of parts were largely offset by lower imports of cars and trucks.