Trade Deficit Narrows to $1.0 Billion in April

Key Insights

Exports of energy products increased the most out of all product sections this month, as many subcategories posted strong gains. Notably, natural gas exports surged by 60.1 per cent, returning to more typical levels due to milder temperatures in the northeastern United States. Crude oil exports rebounded by 3.0 per cent, in line with a recovery in refining capacity in the US Midwest. Furthermore, natural gas exports increased, supported by higher propane exports to Japan in April.

On the import side, motor vehicles and parts, as well as aircraft and other transportation equipment and parts, contributed most to the monthly increase. Imports of passenger cars and light trucks rose by 9.2 per cent, driven by higher imports of sport utility vehicles and other light trucks from the U.S., which aligns with increased production in the U.S. Meanwhile, imports of aircraft and transportation equipment and parts grew, bolstered by higher imports of ships, including a ferry from China that will run between Newfoundland and Nova Scotia

Exports are expected to outpace imports this year. Although that dynamic will come behind both moderate export and import activity. Export growth will be weighed down by a cooling of the U.S. economy, with the underlying weakness in exports felt most acutely in non-energy exports. Meanwhile, import growth will lag behind that of exports. There are risks to the trade outlook, such as weaker global economic activity and ongoing geopolitical tensions.