Josh Nye, senior economist at Royal Bank of Canada, notes that the Canada’s trade deficit narrowed to $4.2 billion in January from a record $4.8 billion shortfall in December.
Key Quotes
“Lower crude oil prices were behind Canada’s wider trade deficit toward the end of last year. A decent rebound in global and Western Canadian oil prices in January helped boost nominal exports.”
“Crude oil export volumes were close to flat in January despite the Alberta government’s mandatory oil production curtailments taking effect in the month. That is consistent with a drawdown in elevated crude inventories.”
“Today’s trade report provides a bit of encouragement. It’s a good reminder that the energy sector’s near-term difficulties, which weighed on growth toward the end of last year, should be largely transitory. Prices have rebounded this year and output should follow as mandatory curtailments are reduced.”
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