Canada 4Q Current Deficit Narrows to C$16.35 Billion
By Paul Vieira
OTTAWA--Canada's current-account deficit narrowed in the fourth quarter at a faster-than-anticipated pace, due to an improvement in the trade of goods.
The country's current-account deficit shrank in the fourth quarter to a seasonally adjusted 16.35 billion Canadian dollars ($12.76 billion), Statistics Canada said Thursday. Market expectations were for a C$17.65 billion deficit, according to economists at Royal Bank of Canada.
The previous quarter's deficit was revised to C$18.59 billion from C$19.35 billion.
The current account is the broadest indicator of trade in goods and services, and covers items such as employee wages and investment income. A deficit suggests an economy is importing more capital and goods and services than it exports. This tends to put downward pressure on a country's currency.
Among the Group of Seven countries, only the U.K. has a bigger current-account deficit as a percentage of gross domestic product. Canada's GDP data for the fourth quarter comes out Friday.
In the fourth quarter, Canada posted a C$7.16 billion deficit in the trade in goods, versus a C$9.02 billion deficit in the previous quarter. Canada's deficit in the international trade of services expanded to C$6.47 billion from a C$6.17 billion shortfall in the previous quarter.
In the financial account, foreign investment in Canadian securities totaled C$37.92 billion in the fourth quarter, down from C$51.12 billion in the third quarter. The investment activity mainly targeted the Canadian bond market.
For the year 2017, the current account deficit reached C$63.93 billion, down from C$65.37 billion for 2016.
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(END) Dow Jones Newswires
March 01, 2018 09:18 ET (14:18 GMT)Copyright (c) 2018 Dow Jones & Company, Inc.