OTTAWA — Statistics Canada says the country ran a merchandise trade deficit of $2.7 billion in February compared with a deficit of $1.9 billion in January.
Economists had expected a deficit of $2 billion, according to Thomson Reuters.
“It was a rough start to the year in terms of economic data and the bumpy ride continued in today’s trade numbers,” Royce Mendes, analyst at CIBC Capital Markets said in a note to clients.
The increased deficit came as imports rose 1.9 per cent to $48.6 billion, boosted by imports of energy products.
Exports increased 0.4 per cent to $45.9 billion, due to higher exports of passenger cars and light trucks.
Regionally, Canada’s trade surplus with the United States narrowed to $2.6 billion in February compared with $2.9 billion in January as imports from the U.S. grew 3.3 per cent. Exports to the U.S. increased 1.9 per cent.
“Overall, while export volumes did rebound, removing some of the negativity surrounding this report, they remain disappointing given the strong US economy and weak Canadian dollar.” Mendes noted. “The data should be positive for fixed income, as it plays into our forecast for a patient Bank of Canada, and bearish for the Canadian dollar.”
The loonie was down one-tenth of a cent to 78.20 against the U.S. dollar.
Canada’s trade deficit with countries other than the United States increased to $5.3 billion in February from $4.9 billion in January.
© The Canadian Press
With files from Financial Post Staff