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Canada tipped back into a trade deficit in November as an improving domestic economy caused imports to rise at more than three times the pace of exports.

The country posted a surprise deficit of $344-million from a revised $503-million surplus a month earlier, Statistics Canada said Tuesday. The deficit hit a record $2-billion in August and Canada has posted deficits in the past six of eight months.

Imports jumped 3.9 per cent on higher demand for energy, pickup trucks and office machinery, the agency said. Energy products were the main factor behind the 1.1-per-cent gain in exports and without them, exports would have fallen 0.3 per cent.

"This was a very weak report and it underscores the adverse impact that the combination of a strong Canadian dollar and weak global demand is having on the export-dependent Canadian economy," said Millan Mulraine, economics strategist at TD Securities in a note. "With both factors likely to remain in place for some time, we expect net trade to remain unsupportive of Canadian GDP."

Despite the headwinds, Canadian exporters are feeling much more positive about future prospects, a separate survey released Tuesday shows. Confidence that sales will improve over the next six months has "taken a dramatic swing upwards," according to Export Development Canada's semi-annual trade confidence index.

The share of exporters expecting global sales to increase in the next six months is rising after tumbling in three of the last four surveys. And more exporters say their international trade opportunities are improving.

"Trade is definitely in growth mode, but we can't forget the starting point," said Peter Hall, EDC's chief economist. "Canadian exports took a 20-per-cent hit in 2009, six times greater than any annual decline in recent memory. What exporters are saying is that they expect to start climbing out of that chasm."

Exports remain 19 per cent below levels in November, 2008.

Exports rose to $31.6-billion in November as prices rose 1.1 per cent and volumes were unchanged. While the picture is improving, with five gains in six months, exports prices and volumes have each fallen by 16 per cent since the value of exports peaked in July, 2008, the report said.

Imports jumped to $31.9-billion, the third monthly gain in 2009 and nearly offsetting declines in the previous three months. After peaking in July 2008, the value of imports have fallen by almost 20 per cent, mostly due to falling volumes.

"While exporters are benefiting from stronger commodity prices, a strong Canadian dollar and sluggish U.S. recovery continue to weigh on other sectors," said Bank of Montreal economist Benjamin Reitzes in a note. "Coupled with domestic demand-driven import gains, Canada will likely be flirting with deficits throughout 2010."

Canada's trade surplus with the United States, Canada's largest trading partner, narrowed to $3.2-billion from $3.5-billion in October as exports rose 2 per cent while imports grew 3.8 per cent.

Canada's trade deficit with countries other than the U.S. widened to $3.6-billion from $3-billion. Exports fell 1.2 per cent and imports from these countries increased 4 per cent.

Among exports, energy products rose 6.2 per cent. Crude petroleum exports climbed 7 per cent - the third straight increase - to their highest level since October, 2008 amid higher prices and volumes. Exports of other energy products and natural gas also posted gains in November.

Exports of industrial goods and materials fell 2.5 per cent, mainly due to a 19.3-per-cent drop in precious metals exports.

Among imports, autos rose 9.4 per cent on higher volumes. Imports of trucks and other vehicles, especially pickup trucks, jumped 30.1 per cent, accounting for two-thirds of the gain in this sector. Passenger car and car parts also rose.

Imports of machinery and equipment increased 4.3 per cent after three months of declines. Imports of aircraft and office machines and equipment led the gains. Energy products imports rose 13.1 per cent on the strength of crude petroleum and coal.

Economists polled by Bloomberg had expected a $500-million surplus in the month.

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