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Canada posts biggest trade deficit in almost three years, analyst predicts ‘rough summer’

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Canada posts biggest trade deficit in almost three years, analyst predicts ‘rough summer’

A float plane flies past containers and cranes at the Port of Vancouver, British Columbia, Canada, July 30, 2023. REUTERS/Chris Helgren/File Photo

OTTAWA, Aug 8 (Reuters) – Canada’s trade deficit widened to C$3.73 billion ($2.77 billion) in June from May, the largest in nearly three years, as exports dropped 2.2%, outpacing an 0.5% decline in imports, Statistics Canada said on Tuesday.

Analysts in a Reuters poll had forecast a shortfall of C$2.90 billion. Statscan revised May’s deficit to C$2.68 billion from C$3.44 billion reported initially.

Meena Aier, head of Export Development Canada’s research and analysis department, said exporters faced challenges with high inflation as well as unfavorable cost and credit conditions.

“It’s probably going to be a rough July and a rough summer,” she said in a phone interview.

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Canada’s trade deficit with countries other than the United States, its biggest trading partner, widened to an all-time high as month-over-month exports declined 5.5%, while imports were down marginally.

There were broad declines in exports in June, with metal and non-metallic mineral products being the largest drag.

“Weaker global demand and the fading boost from easing supply shortages took a toll on exports in June, confirming that net trade weighed on second-quarter GDP growth,” said Olivia Cross, assistant economist at Capital Economics.

Cross said slumping trade was likely to help pull second quarter annualized growth down to 1.2% from 3.7% in the first quarter, slightly above Statscan’s own estimate of 1%.

The 2.2% drop in exports followed a 3.0% decline in May. The overall trade deficit matched the C$3.73 billion shortfall in October 2020.

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The Canadian dollar traded slightly higher at C$1.3477 to the U.S. dollar, or 74.20 U.S. cents, up from C$1.3498 to the U.S. dollar, or 74.09 U.S. cents.

Total exports fell 1.1% by volume, marking the 11th monthly drop in export prices in the past 12 months.

Total imports declined 0.5%, largely due to lower imports of energy products as well as pharmaceuticals. Imports of unwrought gold jumped, and nearly offset declines in other product categories. By volume, imports were up 0.9%.

Statscan said the impact of a 13-day strike by western Canadian dock workers was likely to be reflected in July data. It also said severe flooding in the province of Nova Scotia could have an impact.

($1 = 1.3453 Canadian dollars)

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Reporting by Ismail Shakil in Ottawa; Editing by David Ljunggren, Bernadette Baum and Jonathan Oatis

Our Standards: The Thomson Reuters Trust Principles.

Covers Canadian political, economic and general news as well as breaking news across North America, previously based in London and Moscow and a winner of Reuters’ Treasury scoop of the year.

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Trump Shows Approval for Nippon Steel's Bid for US Steel, Blesses 'Planned Partnership'

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Trump Shows Approval for Nippon Steel's Bid for US Steel, Blesses 'Planned Partnership'
WASHINGTON (Reuters) -U.S. President Donald Trump appeared to give his approval to Nippon Steel’s $14.9 billion bid for U.S. Steel on Friday, saying the “planned partnership” between the two would create jobs and help the American economy. Shares of U.S. Steel soared 21% as investors interpreted the …
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Power outage disrupts final day of Cannes Film Festival, police investigate possible arson

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Power outage disrupts final day of Cannes Film Festival, police investigate possible arson

A major power outage struck southeastern France on Saturday morning, threatening to jeopardize the Cannes Film Festival’s closing celebrations, including the much-anticipated Palme d’Or ceremony.

Police said they have opened an investigation into possible arson.

Power was restored hours before the ceremony, around 3 p.m. local time, as music began blasting again from beachfront speakers. The end of the blackout was greeted with loud cheers from locals.

CAUSE OF MASSIVE EUROPEAN POWER OUTAGE UNCLEAR AS FULL SERVICE RETURNS

Staff members of the Palais Stephanie Beach inform customers following a major electricity outage, during the 78th Cannes Film Festival in Cannes, France May 24, 2025.  (REUTERS/Benoit Tessier)

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Earlier, about 160,000 households in the Alpes-Maritimes department lost electricity after a high-voltage line fell Saturday morning, electricity network operator RTE said on X. The outage came hours after a fire at an electrical substation near Cannes overnight had already weakened the grid.

“We are looking into the likelihood of a fire being started deliberately,” said a police spokesperson for the French national gendarmerie.

In a statement, Laurent Hottiaux, the prefect of the Alpes-Maritimes department, condemned “serious acts of damage to electrical infrastructure[s].”

PUERTO RICO HIT WITH MASSIVE ISLAND-WIDE BLACKOUT AHEAD OF EASTER WEEKEND

Employees standing in the doorway of a Zara store

Employees stand outside a shop during an electricity outage in Cannes, southern France, Saturday, May 24, 2025.  (AP Photo/Natacha Pisarenko)

“All resources are mobilized to identify, track down, arrest and bring to justice the perpetrators of these acts,” said Hottiaux.

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Cannes Film Festival organizers confirmed the outage affected the early activities of Saturday and said the Palais des Festivals — the Croisette’s main venue — had switched to an independent power supply.

“All scheduled events and screenings, including the Closing Ceremony, will proceed as planned and under normal conditions,” the statement said. “At this stage, the cause of the outage has not yet been identified. Restoration efforts are underway.”

A powerless traffic light in the south of France

Traffic lights are switched off during an electricity outage in Cannes, southern France, Saturday, May 24, 2025. (AP Photo/Lewis Joly) (AP Photo/Lewis Joly)

Traffic lights in parts of Cannes and the surrounding city of Antibes stopped working after 10 a.m., leading to traffic jams and confusion in city centers. Most shops along the Croisette remained closed, and local food kiosks were only accepting cash. Train service in Cannes was also disrupted.

Screenings at the Cineum, one of the festival’s satellite venues, were briefly suspended, the festival added.

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The Palme d’Or — the festival’s most prestigious prize — was set to be awarded Saturday night, with top contenders including Joachim Trier’s family drama “Sentimental Value,” Jafar Panahi’s revenge thriller “It Was Just an Accident,” Kleber Mendonça Filho’s political thriller “The Secret Agent,” and Óliver Laxe’s desert road trip “Sirât.”

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Australia begins cleanup after floods kill 5, strand thousands

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Australia begins cleanup after floods kill 5, strand thousands

Hundreds of residents remain in evacuation centres, with 52 rescues made overnight despite conditions easing.

Prime Minister Anthony Albanese has announced the start of a cleanup operation in eastern Australia after record-breaking floods killed five people and stranded tens of thousands of people.

Damage assessments are under way for the coastal region of New South Wales in the east, where at least 10,000 properties are thought to have been damaged, the state’s emergency services agency said on Saturday.

Conditions have eased since Friday after days of relentless rain isolated towns, swept away livestock and destroyed homes, the agency added.

“We’re continuing to work closely across federal, state and local governments to make sure Australians get the support they need now and through recovery,” Albanese posted on X.

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Despite improving conditions, hundreds of residents remain in evacuation centres with 52 rescues made overnight, State Emergency Services commissioner Mike Wassing said.

Joanna Ally reacts as she cleans up the Manning Support Services centre in Taree [Hollie Adams/Reuters]

The death toll from flooding rose to five after a man in his 80s was found at a flooded property about 50km (32 miles) from Taree, one of the worst-hit towns, police said.

It’s “awful to hear the news of more loss of life”, Albanese said after being forced to cancel his trip to Taree on Friday due to floodwaters.

At their worst, the flooding isolated about 50,000 people and submerged roads in the country’s most populous state.

Coastal areas were left littered with debris and dead animals after a powerful storm system dumped months’ worth of rain in three days.

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Train services, including airport services, were affected by flooded tracks. Sydney airport shut two of its three runways for an hour on Friday morning, delaying flights.

Australia has suffered a series of extreme weather events in recent years, which experts have attributed to climate change.

Frequent flooding has caused widespread devastation in the country since early 2021, following droughts and bushfires at the end of the last decade.

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