Canada’s newest commerce numbers point out that the continuing dispute with the US continues to take its toll, with
metal, aluminum
and cars “bearing the brunt.”
Statistics Canada information launched Tuesday revealed the commerce deficit grew to $5.9 billion in June from a downwardly revised $5.5 billion the month earlier than, as imports outpaced exports, rising 1.4 per cent versus 0.9 per cent.
“Canada’s deficit in items commerce was little modified in June, albeit with loads of shifting items within the element as a consequence of
U.S. tariff coverage
,” Andrew Grantham, an economist with CIBC Capital Markets, mentioned in a be aware, including that “Canadian commerce nonetheless hasn’t discovered a brand new footing.”
Particulars behind the numbers belied an obvious improve in commerce exercise.
Imports rose as a consequence of a one-off cargo of commercial equipment to a Newfoundland oil undertaking, whereas exports rose primarily on a leap within the worth of oil.
Minus these elements, Grantham mentioned imports shrank practically two per cent and exports fell 0.4 per cent when adjusted for inflation.
“Whereas commerce flows ought to stabilize within the months forward, the extent of commerce will stay decrease than it was beforehand as a consequence of ongoing U.S. tariff coverage and associated uncertainty,” Grantham mentioned.
Exports to the U.S. have been down 12.5 per cent in June from the identical time final 12 months, whereas imports have been down 4.2 per cent 12 months over 12 months.
Economists attribute the majority of the lower in U.S. exports to the continuing decline in shipments of aluminum and metal, with the
doubling of tariffs
to 50 per cent from 25 per cent having a “clear influence,” Grantham mentioned, including that exports in each sectors have been down simply over 11 per cent, their lowest ranges since 2020.
Auto exports have been additionally down, falling 4.2 per cent on the month to lows not seen since late 2022.
Shelly Kaushik, an economist at BMO Capital Markets, mentioned in a be aware that auto exports have been down 8.5 per cent 12 months over 12 months “
alongside slower home manufacturing.”
CIBC’s Grantham estimated that commerce to the U.S. accounted for 70 per cent of exports, which is up from Could however nonetheless beneath the 75 per cent common.
Marc Ercolao, an economist at
Toronto-Dominino Financial institution
, mentioned in a be aware he believes that exports will proceed to recuperate after practically hitting a five-year low in April.
“It’s the sectors impacted by tariffs — metal, aluminum, autos and vitality — that proceed to disproportionately bear the brunt of the shock,” he mentioned.
June’s information additionally closed the books on the second quarter, and Ercolao thinks commerce will put a “substantial dent” in Canada’s financial progress. TD is forecasting the economic system will contract two per cent within the second quarter, annualized from the primary quarter.
One shiny spot within the commerce report was the obvious resilience of the rise in exports to different international locations.
U.S. commerce hole narrows to tightest since 2023 on drop in imports
‘The temper is dour’: Menace of commerce deal delay weighs on some sectors greater than others
Though exports to non-U.S. buying and selling companions pulled again in June, items shipped to China, Mexico, Germany, United Kingdom, South Korea and the Netherlands rose year-over-year for the month.
“When put next with the identical month in 2024, exports to locations aside from the US have been up 14.7 per cent in June 2025,” Statistics Canada mentioned in a press launch.
“Canadian export rotation into non-U.S. markets is showing to have some endurance, a pattern policymakers want to see persist,” Ercolao mentioned.
• Electronic mail: gmvsuhanic@postmedia.com
