By Robb M. Stewart
OTTAWA--A retreat in gold exports drove a sharp deepening of Canada's trade deficit with the world in November.
The country recorded a merchandise-trade shortfall of almost 2.2 billion Canadian dollars, the equivalent of about US$1.62 billion, Statistics Canada said Thursday.
That was much wider than the $690 million deficit economists expected and October's C$395 million gap.
Canadian exports declined 2.8% between October and November to C$63.94 billion, while the value of goods coming into the country dipped 0.1% to C$66.14 billion, the data agency said.
At the same time, shipments to the U.S. fell 1.8% for a second consecutive pullback and imports from the neighboring country dropped 5.4% to the lowest level since February 2022. That widened Canada's longstanding surplus with its biggest trading partner to C$6.58 billion from C$5.23 billion.
The data comes a day before Statistics Canada is due to release industry-level gross domestic product figures for November and a forecast for the final month of the year. The agency previously estimated the economy eked out 0.1% growth month-over-month in November following the sharpest contraction a month earlier since the end of 2022.
Canada has been hit hard by U.S. tariffs and uncertainty and the central bank has forecast the economy likely stalled in the final quarter of last year as exports continued to be buffeted by the Trump administration's trade policy. The central bank, which this week left its policy interest rate unchanged a second time in a row, projects an only gradual pick up in growth over this year and next.
In volume terms, Canadian exports fell 0.9% in November, while imports rose 0.9% from the month before.
After rising some C$4.7 billion over the previous two months, Canadian exports of metals and minerals slumped C$3.2 billion, or 24.4%, in November. That was largely thanks to large declines in movements of unwrought gold to the U.K., U.S. and Hong Kong.
Still, even with the weakness in November exports from Canada of precious metals were up a strong 39.5% since the beginning of 2025 as the price of gold has continued to hit all-time highs thanks to central bank purchases and investor interest in safe-haven assets.
Excluding metal and mineral shipments, Canadian exports climbed 2.5% in November.
Exports of motor vehicles and parts were down sharply, hitting the lowest level in three years, as the production of passenger cars and light trucks was disrupted by a semiconductor shortage. Exports of medium and heavy trucks and buses sank 53.8% for the latest month, coinciding with the introduction of new U.S. tariffs.
Moderating the fall in exports, shipments of energy products were up with higher volumes of crude oil and bitumen. That came after a sharp fall in October when temporary production shutdowns at U.S. refineries curbed demand.
Imports into Canada of motor vehicles and parts were down in November, with a pullback in cars and light trucks following two straight months of increased inbound shipments. Imports of energy products also fell, though consumer goods imports were up thanks partly to a recovery in demand for pharmaceutical and medicinal products rose.
After rising strongly from August to October, Canadian exports to countries other than the U.S. fell 4.9% in November. The same month, imports from non-U.S> countries rose 7.8% to a record high. That resulted in a widening of Canada's trade deficit with countries beyond the U.S. to C$8.78 billion from C$5.63 billion a month earlier.
With the U.S. set to review the existing North American free trade pact this year, uncertainty remains heightened. In an effort to pivot the country away from a reliance on the U.S. and strengthen its resilience, Prime Minister Mark Carney is targeting a doubling of non-U.S. exports over the next decade
When international trade in goods and international trade in services were combined, Canadian exports fell 2.5%, while imports edged down 0.1%. As a result, Canada swung to a trade deficit incorporating both goods and services of C$2.19 billion from a small C$27 million surplus in October.
Write to Robb M. Stewart at robb.stewart@wsj.com
(END) Dow Jones Newswires
01-29-26 0857ET
