Canada's weaker loonie helped widen trade surplus in June: StatCan

Canada's trade surplus with the world expanded to C$3.9 billion in June, reaching its fourth consecutive month of positive balance. Statistics Canada reported that while merchandise exports increased by 0.4 percent and imports fell by 0.2 percent, the weaker loonie played a significant role in inflating the Canadian dollar value of these transactions.

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A trade surplus happens when an economy exports more than it imports, and the opposite is known as a trade deficit.

The Canadian dollar averaged about 71 U.S. cents in June, a decline that meant each U.S. dollar earned from exports converted into more Canadian dollars. This effect masked a decrease in actual trade volumes when measured in U.S. dollars, where exports fell 2 percent and imports dropped 2.1 percent.

Despite the currency's impact, the total value of Canadian exports reached a record C$77.5 billion. The volume of goods shipped also increased by 1.1 percent. Six out of 11 tracked sectors saw higher export values, with metal and non-metallic mineral products leading the growth at 16.5 percent. Unwrought gold, silver, and platinum group metals saw a significant 27.9 percent increase.

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Since most international trade is priced in U.S. dollars, the weaker loonie increased the Canadian-dollar value of exports that Statistics Canada tracks.

However, exports of unwrought aluminum and aluminum alloys dropped sharply by 28.8 percent, potentially linked to U.S. tariffs. Copper ore and concentrate exports to countries like Japan, China, Finland, and South Korea hit a record $934 million, up 20 percent from May. Energy exports, including crude oil, decreased by 10 percent due to falling global prices.

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This means Canada shipped more goods even though some prices were comparably lower for international buyers.