Canadian exports suffer biggest one-month decline since the recession

Canadian exports in February posted their biggest one-month fall because the recession, in across-the-board declines that pared back recent gains.

Shipments of products abroad fell 5.4 per cent to $43.7 billion during the month, the largest drop since May 2009 after rising to records in January. Imports fell 2.6 percent. Canada’s trade deficit widened to $1.9 billion, twice what economists forecast, from $628 million per month earlier.

February’s stop by non-energy exports, that have been down 4.2 per cent, marks a setback in the Bank of Canada’s narrative that those industries will drive the nation’s recovery in coming months and years.

The weakness in exports was across the board. Consumer goods exports plunged 14 per cent, automobile sales were down 4.4 percent and forestry-related products fell 6.4 per cent. That’s on top of continued declines in energy shipments, which fell 14 percent for their lowest since 2004.

The biggest gainers in February were mineral product exporters, up 3 per cent, and aircraft manufacturers who saw exports increase 25 per cent.

From last year, most non-energy exports still post gains, led by a 46 per cent rise in motor vehicles and parts.

The volume of exports dropped 2.2 per cent, while import volumes were down 1.2 percent. From a year earlier, real exports have raised 7.8 per cent, while imports are down 0.3 percent.

Economists surveyed by Bloomberg News had forecast a trade deficit of $900 million in February.
Bloomberg.com