Canadian International Trade (April 2022)

Canada's International Trade Surplus Narrows in April 

• Canadian merchandise exports (+0.6%) and imports (+1.9%) saw muted growth in April, driven by higher prices.
• Merchandise exports fell 0.4% in volume terms, while imports fell 2.1%. Merchandise imports for clothing, footwear and accessories (+24.2%) were strong in April as we start to see supply chain problems ease. 
• Merchandise exports were mainly driven by gains in consumer goods (+5.0%) and exports in motor vehicles and parts (3.9%). 
• Trade in services decelerated in April, as import services grew at 5.5% (down from 6%), while export services grew 1.6% (down from 3.4%).
• Increases in travel exports (+11.9%) drove the rise in export services. This can be explained by Canada relaxing its Covid entry requirements which were implemented April 1st, 2022. Travel Imports also rose 17%.        

Key Implications

• Canada's trade surplus narrowed in April, as the surplus in goods trade led the decline. Services trade also contributed to the move, as travel restrictions were lifted in Canada. 
• Going forward, we see an improvement in the trade balance as higher commodity prices should support Canadian exports. Furthermore, easing supply chains should open the way for an further gains in manufacturing exports.  

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