Skip to main content
Open this photo in gallery:

Cargo containers are seen stacked at a port in Vancouver on Feb. 21, 2020.DARRYL DYCK/The Canadian Press

Canada posted a wider-than-expected trade deficit of $1.47-billion in January, largely on lower exports of motor vehicles and parts, official data showed on Friday.

Analysts polled by Reuters had forecast a shortfall of $830-million. Statistics Canada revised the December deficit up to $732-million from an initial $370-million.

The value of exports fell by 2.0 per cent in January, the largest decline reported since the 5.6 per cent decline in June, 2019, to $48.14-billion, with nine of the 11 product sections tracked by Statscan posting declines. Imports dropped by 0.5 per cent, with declines seen in six of the 11 product sections.

Canada’s central bank slashed a key interest rate on Wednesday by half a percentage point, the most in more than a decade, as it worked to try and protect Canada’s economy from a coronavirus outbreak and said it was prepared to ease further if needed. Money markets anticipate another rate cut in April.

Statscan said on Friday it was monitoring the possible effects of the coronavirus outbreak on Canada’s international trade data, particularly with China, where the agency said “substantial decreases in exports and imports with China” had already been observed in January.

Canadian monthly exports to China declined 7.8 per cent in January, with lower exports of gold, potash and wood pulp reported, the agency said, while imports fell 12.1 per cent, mainly on lower cellphone imports.

Meanwhile, Statscan said overall exports of motor vehicles and parts saw the largest decline in January, falling 4.1 per cent on lower exports of passenger cars and trucks. Temporary shutdowns at certain assembly plants and the recent closing of an Ontario-based General Motors plant contributed to the decline.

Canadian exports to the United States dropped 1.7 per cent, mainly because of the lower passenger car and truck shipments. As a result, Canada’s trade surplus with the U.S. narrowed to $3.56-billion in January, the smallest surplus since February, 2019. Imports of consumer goods fell 6.3 per cent on the month, largely owing to a 26.1 per cent decline in pharmaceutical imports, notably on lower shipments of antiviral and cancer treatment drugs, the agency added.

Your time is valuable. Have the Top Business Headlines newsletter conveniently delivered to your inbox in the morning or evening. Sign up today.

Follow related authors and topics

Authors and topics you follow will be added to your personal news feed in Following.

Interact with The Globe