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Economic News

Canada: Four Straight Monthly Trade Surpluses

August 4, 2026
LJ Valencia
Economist

Highlights

  • Canada’s international merchandise trade surplus increased to $3.9B in June 2026 from a downwardly revised $3.7B in May (graph 1). This was above the consensus expectation for a $3B surplus. See table for more details.
  • Goods exports rose 0.4% m/m, with volumes increasing by 2.6%. Imports were up 0.2%, but volumes fell by 1.8%.
  • Canada’s trade surplus with the United States decreased from $11.1B to $10B in June (graph 2). Meanwhile, the trade deficit with countries other than the US contracted from $7.4B to $6.1B.
  • The services trade deficit was unchanged at $0.3B in June. Exports of services fell by 0.2% m/m while services imports were down 0.4% in the month.

Comments

June’s trade surplus came in well above the expectations of private sector forecasters. The June trade number marked a fourth consecutive surplus.

Six of the 11 export categories posted gains in June. Exports of metal and non-metallic mineral products led the advance (16.5%). This was largely attributable to higher gold shipments to the United Kingdom and increased purchases of Canadian-held gold by foreign residents. Exports of metal ores and non-metallic minerals also grew (7.3%), mostly on the back of higher copper ore and concentrates exports to Japan, China, Finland and South Korea. These export gains were somewhat offset by falling energy exports (-10%), mainly driven by lower energy prices.

On the import side, 9 of 11 product categories posted declines. Lower imports were observed in industrial machinery, equipment and parts (-3.3%) and consumer goods (-1.3%). Still, these losses were more than offset by higher imports of electronic and electrical equipment and parts (11.7%). The increase in that category was largely driven by higher imports of processing units used in data centres from the United States. Consequently, overall imports grew during the month of June.

Canada’s trade partnerships are evolving. Despite reduced activity with the US, trade with other countries has been trending higher (graph 3). Consequently, non‑US countries now account for 30.5% of exports on a seasonally adjusted basis in June 2026, well above the roughly 25% seen in the years before the pandemic.

Implications

Despite the trade surplus in June, net exports are expected to have been a modest drag on Q2 output growth. Strong export volume growth (24% annualized) wasn’t enough to offset higher real import levels. We anticipate real GDP growth of around 2.5% annualized in Q2 2026, in line with the Bank of Canada’s outlook published in the July 2026 Monetary Policy Report External link..

Still, uncertainty surrounding US trade policy remains a headwind to growth. With that in mind, the pace of economic expansion could slow once again. With underlying inflation remaining contained and further economic recovery likely to be slow and uneven, we expect the Bank to leave its current policy mix in place through the end of the year.

NOTE TO READERS: The letters k, M and B are used in texts, graphs and tables to refer to thousands, millions and billions respectively. IMPORTANT: This document is based on public information and may under no circumstances be used or construed as a commitment by Desjardins Group. While the information provided has been determined on the basis of data obtained from sources that are deemed to be reliable, Desjardins Group in no way warrants that the information is accurate or complete. The document is provided solely for information purposes and does not constitute an offer or solicitation for purchase or sale. Desjardins Group takes no responsibility for the consequences of any decision whatsoever made on the basis of the data contained herein and does not hereby undertake to provide any advice, notably in the area of investment services. Data on prices and margins is provided for information purposes and may be modified at any time based on such factors as market conditions. The past performances and projections expressed herein are no guarantee of future performance. Unless otherwise indicated, the opinions and forecasts contained herein are those of the document’s authors and do not represent the opinions of any other person or the official position of Desjardins Group.