Canadian goods deficit narrows in April

Canadian goods deficit narrowed in the month of April. Deficit narrowed by nearly half CAD 1.9 billion. Exports rose 1.6 percent, driven by metal and non-metallic mineral products and consumer goods. Meanwhile, imports dropped 2.5 percent in the month, held back by motor vehicles and parts as well as consumer goods. In terms of volume, exports grew by a slightly less pronounced 1.2 percent. Meanwhile, imports dropped 2.4 percent on the month.

Exports grew for the sixth time in seven months to a record high and are up 3.1 percent on a year-on-year basis. Shipments of metals and non-metallic minerals rose 9.1 percent, more than reversing the 7.8 percent slump seen in February, aided by solid sales of intermediate metals including unwrought gold. Consumer good exports also rose strongly by 5.4 percent sequentially, led by a sharp rise in pharmaceuticals. Exports of autos and parts rose 1.3 percent sequentially while other transport products saw a fall of 14.2 percent.

Imports fell after two straight months of rises. Autos and parts declined, countering two solid months during which the category rose over 10 percent. Other transport equipment imports also fell, declining 3.9 percent in April, after three straight monthly gains. A similar story emerged for consumer goods imports with the pull-back appearing to be related to past strength.

The figures give further evidence that after some weakness in the first quarter, growth in the second quarter has recovered, with the current tracking pointing to a near 3 percent rate, stated TD Economics in a research report. However, in spite of the good monthly print, Canadian exports might face rough ride in the months ahead, and possibly quarters, added TD Economics.

At 17:00 GMT the FxWirePro's Hourly Strength Index of Canadian Dollar was neutral at -22.6755, while the FxWirePro's Hourly Strength Index of US Dollar was bearish at -79.8491. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex

FxWirePro launches Absolute Return Managed Program. For more details, visit http://www.fxwirepro.com/invest