Canada Goods-Trade Surplus Widens Slightly With Record Exports, Imports — Update

By Robb M. Stewart

OTTAWA--Canada's goods-trade surplus with the world widened slightly in June as a softer currency helped drive the value of exports and imports to all-time highs.

Canada recorded a merchandise-trade surplus of 3.86 billion Canadian dollars, the equivalent of about US$2.74 billion, Statistics Canada said Tuesday. That was larger than the positive C$3 billion trade balance that economists had anticipated.

The country has now racked up surpluses four straight months, following May's downwardly revised C$3.7 billion.

Exports of Canadian goods increased 0.4% to C$77.79 billion in the latest month, while imports nudged up 0.2% to C$73.63 billion, the national data agency said.

Shipments to the U.S. rose a fifth consecutive months with an advance of 0.3%, and imports climbed 3% to the highest on record. That narrowed Canada's longstanding surplus with its biggest trading partner to C$9.98 billion from C$11.12 billion a month earlier.

The average value of the Canadian currency depreciated 1.7% against the U.S. dollar in June, the sharpest pullback since October 2022 and a big influence on the value of trade that largely is completed in U.S. dollars. In U.S. dollar terms, exports declined 2% and imports were down 2.1% between May and June.

For the second quarter, total exports jumped 13.1%, the strongest increase since the third quarter of 2020. Almost half of the rise was due to increased energy exports, as well as a lift in shipments of motor vehicles and parts. Imports for the quarter were up 4.2%.

The surge in quarterly exports, which increased 5.4% in volume terms against a 1.4% rise, comes after net trade weighed on Canada's economy in the first three months of the year and contributing to a second straight decline in quarterly gross domestic product.

The Bank of Canada, which has left its policy interest rate unchanged six times in a row, forecasts a steady recovery for the economy into next year but has flagged a risk to inflation from the war in the Middle East and a threat to growth from U.S. trade policy.

June's rise in exports was buoyed by a nearly 28% increase in precious metals with a rise in gold shipments to the U.K. and higher purchases of Canadian-held gold by foreign residents. Exports of copper ores and concentrates also rose strongly to reach the highest on record, with shipments to Japan, China, Finland and South Korea.

Exports of motor vehicles and parts were up for a fifth consecutive month with an increase auto production in Canada.

Still, exports of energy products fell 10%, mainly due to a drop in crude oil with a pullback in prices during the month.

The modest rise in June imports was led by computers and computer peripherals, without which inbound shipments would have fallen 1.3% for the month.

Canada's monthly trade deficit with countries other than the U.S. narrowed to C$6.13 billion from C$7.42 billion a month prior as exports increased 0.7%, but imports fell 3.7% after rising to a record high in May. Prime Minister Mark Carney is targeting a doubling of non-U.S. exports over the next decade in an effort to pivot the country away from a reliance on the U.S. and to strengthen its resilience.

Canada's economy has recovered strongly after two weak quarters, and is tracking annualized growth of about 3.4% for the second quarter, which would be the fastest pace since the first quarter of 2023.

Canadian businesses have shown signs of adapting to President Trump's policies in recent months, though the potential for further disruption remains high after the president recently threatened to impose a 50% tariff on certain Canadian goods as early as Aug. 19.

When international trade in goods and international trade in services were combined, Canadian exports edged down 0.2% in June, while imports fell 0.4%. As a result, Canada's trade surplus incorporating both goods and services widened to C$3.6 billion from C$3.39 billion in May.

Write to Robb M. Stewart at robb.stewart@wsj.com

(END) Dow Jones Newswires

August 04, 2026 08:57 ET (12:57 GMT)