April's $7.1B merchandise trade deficit was the largest on record

Jenna Benchetrit · CBC News

· Posted: Jun 05, 2025 10:59 AM EDT | Last Updated: June 5

Canada posted a $7.1 cardinal merchandise commercialized shortage successful April — the largest connected record — as exports fell sharply successful the look of U.S. tariffs.

The April figures travel a $2.3 cardinal shortage successful March, according to Statistics Canada, a play that saw businesses stocking up connected inventory up of wide U.S. tariffs, which kicked successful the pursuing month. 

"The Canadian goods commercialized shortage deed a grounds precocious successful April successful an ugly-looking circular of data. Still, the monthly commercialized numbers were expected to beryllium highly volatile [before and after] the March/April U.S. tariff announcements," wrote Nathan Janzen, adjunct main economist astatine RBC Economics, successful a enactment to clients.

Canada's wide exports fell 10.8 per cent to $60.4 cardinal successful April, their lowest level since June 2023, said Statistics Canada. The information bureau recovered notable declines successful trade-exposed sectors, including:

• Motor vehicles and parts, which saw a 17.4 per cent driblet successful exports.
• Consumer goods, which saw a 15.4 per cent driblet successful exports.
• Energy products, which saw a 7.9 per cent driblet successful exports.

The commercialized information is accordant with Canadian GDP maturation seen successful the archetypal quarter, wrote Janzen. The annualized complaint bushed expectations mostly owed to a bump successful nett commercialized and an "import-led jump" successful instrumentality investment, helium added.

RBC expects maturation to dilatory sharply successful the 2nd quarter — a sentiment echoed by Bank of Canada politician Tiff Macklem connected Wednesday during the cardinal bank's involvement complaint announcement.

WATCH | Why experts accidental a large-scale displacement backmost to U.S. manufacturing is unlikely:

But the April figures aren't simply showing commercialized numbers normalizing after a volatile period, according to Pedro Antunes, main economist astatine the Conference Board of Canada.

"We're seeing a diminution successful export enactment from below-normal levels," helium said. "When we look astatine the wide commercialized numbers successful presumption of merchandise commercialized oregon trading goods, this is not a bully quality story.

"We're hopeful that this volition lone past a quarter — and we're hopeful astir that due to the fact that it's conscionable arsenic atrocious for the U.S. economy, this commercialized war, arsenic it is for Canada's."

Canadian exports to U.S. fell 15.7%

Total imports fell 3.5 per cent successful April to $67.6 billion, arsenic imports of centrifugal vehicles and parts mislaid 17.7 per cent and concern machinery, instrumentality and parts dropped 9.5 per cent.

In existent oregon measurement terms, full exports fell 9.1 per cent successful April, portion imports fell 2.9 per cent that month.

Canada posted a merchandise commercialized surplus with the U.S. of $3.6 cardinal successful April, the smallest surplus with the country's largest trading spouse since December 2020. The effect came arsenic exports to the U.S. fell 15.7 per cent, and imports from the U.S. dropped 10.8 per cent.

Meanwhile, Canada's commercialized shortage with different countries was $10.7 cardinal successful April compared with $9 cardinal successful March.

Exports to countries different than the U.S. roseate 2.9 per cent to $18.3 cardinal successful April, portion imports from non-U.S. countries gained 8.3 per cent to deed a grounds $29 billion.