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Canada posts 1st global trade surplus since December 2016 as non-US imports fall

Canada's global merchandise trade balance unexpectedly moved to a surplus for the first time since December 2016, driven by a sharp decline in imports from countries other than the U.S.

Statistics Canada said the country posted a seasonally adjusted C$526 million trade surplus in August following a revised deficit of C$189 million in July. Econoday projected a C$500 million deficit.

Total imports fell 2.5% month over month to C$50.02 billion from a revised C$51.30 billion, with declines recorded in seven of 11 product sections.

Imports of aircraft and other transportation equipment and parts dropped 27.8% month over month in August, and imports of consumer goods went down 3.7%. Imports of motor vehicles and parts fell 3.8%.

Despite gains in six of 11 product sections, total exports slipped 1.1% to C$50.55 billion in August from a revised C$51.11 billion in July. Exports of motor vehicles and parts, as well as those of metal and non-metallic mineral products, dropped 6.2%, offset by a 20.1% jump in exports of metal ores and non-metallic minerals.

Year over year, Canada's total imports were up 7.3% in August, while total exports climbed 15.5%.

Canada's trade deficit with countries other than the U.S. narrowed to C$4.8 billion in August from C$5.5 billion in July. Imports fell 4.5% to C$17.6 billion, and exports edged down 0.9% to C$12.8 billion.

China, Brazil, Belgium, Algeria and the Netherlands were among the countries that contributed to the decline in non-U.S. imports.

In August, Canada's trade surplus with the U.S. was virtually unchanged month over month at C$5.35 billion, which is still the biggest surplus since October 2008. Imports from the U.S. fell 1.3% to C$32.39 billion, and exports went down 1.2% to C$37.73 billion.

Exports of Canadian steel products to the U.S. that were subject to new tariffs rose 6.3% on a monthly basis in August, while exports of aluminum products slapped with additional duties fell 13.2%.