Canada reported a trade surplus of C$684 million ($505 million) in July, as imports fell at a faster pace than exports, according to data from Statistics Canada on Wednesday. The trade balance for June was also revised, shifting from an initial surplus to a deficit. Exports saw a 0.4% decrease in July following a 4.7% rise in June, driven by declines in motor vehicles, parts, wheat, and canola. In volume terms, exports dropped by 1.5%. Stuart Bergman, chief economist at Export Development Canada, noted the broad weakness in export volumes, describing it as part of a fluctuating trend, which adds uncertainty for businesses.
Imports fell by 1.7%, following a record high of C$66.1 billion in June. The decline was primarily due to reduced purchases of motor vehicles, parts, and aircraft. Import volumes also decreased by 2%. Analysts had anticipated a trade surplus of C$0.8 billion for July. June’s figures were revised to show a deficit of C$179 million from a previously reported surplus of C$638 million.
Bergman also highlighted the impact of higher interest rates and prices on consumer activity. The Bank of Canada, which has begun lowering interest rates to support the economy, is expected to announce its next policy decision soon. The Canadian dollar remained steady, trading at 1.3552 per U.S. dollar, or 73.79 U.S. cents.
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