EDC Export Performance - December 2016

In the run up to November’s US elections, Canadian merchandise exports increased by 0.5% in October in nominal terms. The growth in was supported by stronger pricing, fueled by a 1.4% depreciation in the Loonie against the US dollar in October. Overall, exports have now increased in four of the last five months.

On sector basis, 7 of 11 saw declines with aircraft and other transportation equipment (-4.5%) and consumer goods (-3.2%) experiencing the biggest declines. However, underneath the headline number, exports in nearly all segments of consumer goods grew in October. A 28.5% decline in the volatile pharmaceuticals and medical products weighed down the category.

The energy (5.5%), motor vehicles and parts (3.2%) and forestry products (0.4%) sectors were all contributors to Canada’s export growth in October. The growth in the automotive side continues to benefit from a stronger economy and capacity constraints in the US.

Canada’s trade balance with the world was $1.1 billion in October, which was the smallest since the start of the year. It also represented a normalization of the deficit after a one-time machinery & equipment import had blown the gap to $4.4 billion a month earlier.

Exports to the US grew by 1.6%, driven by growth in energy exports, while exports also increased to Japan (7.0%) and China (2.7%). Canada’s exports to the United Kingdom fell by nearly 23% in October due mainly to fewer shipments of precious metals.

This report is available in its entirety on the EDC website.