Canada’s trade surplus for December grew to $2.7 billion, more than double the previous month and its best showing since the global financial crisis three years ago.
CIBC economist Emanuella Enenajor said the better than expected data should give a little lift to the overall fourth-quarter economic results, but will also carry over some momentum going into the first quarter of this year.
“It is a positive indicator for the start of 2012,” she said.
Enenajor said recent improvement in the U.S. economy is benefiting Canada’s exporters, but that isn’t expected to last as the U.S. government cuts spending.
“While exports will likely be stronger in the first half of the year, we’re expecting a slowdown in export activity as the year progresses,” she said.
Statistics Canada said Friday that merchandise exports rose 4.5 — in December and imports edged up 0.8 —, pushing the country’s trade surplus with the rest of the world up from $1.2 billion in November.
The agency said exports grew to $42 billion in December as volumes increased 4.9 —, continuing a upward trend that began last July. Imports increased to $39.3 billion as volumes rose 1.2 —.
Peter Hall, chief economist at Export Development Canada, said the results surprised him to the upside due to strength in exports to the U.S. and Japan.
“This is a year that could have gone horribly wrong because of the political disturbances in the Arab Spring and the litany of natural disasters that we had,” he said.
“I can’t believe how good the growth was for December, but there is good reason for it. It is substantiated in what is going on in America for the moment.”
Both U.S. exports and imports posted their highest levels since October 2008 as the trade surplus with Canada’s largest trading partner grew to $5.5 billion in December from $4.7 billion in November.
Exports to the United States rose 5.3— to $30.2 billion with higher shipments of crude petroleum, aircraft and precious metals, while imports from south of the border increased 2.8 — to $24.7 billion.
Exports to countries other than the United States increased 2.5 — to a record high of $11.8 billion. Imports from countries other than the United States fell 2.6 — to $14.7 billion, a result of lower imports from the European Union.
The trade deficit with countries other than the United States narrowed to $2.9 billion from $3.5 billion in November. It was the lowest deficit since December 2010.
Enenajor noted that exports to the eurozone could be a difficult market as it is mired in recession and Canadian exports to Asia and other developing markets still only make up a small portion of the overall picture.
“We don’t necessarily have the trade ties that we’d like to with emerging markets. That’s gradually improving, but it is still the case that Canada has yet to really broaden its export base,” she said.
The trade report came as accounting and consulting firm PwC said more than half of Canadian manufacturers surveyed feel optimistic about the prospects for the Canadian economy over the next 12 months.
The firm said 90 — of those asked expected revenue growth for their own companies, with 10 — forecasting double-digit growth.
“Industrial manufacturing CEOs are now focusing on the upside rather than the downside,” said Calum Semple, a consulting partner at PwC.
“Across the board we’re seeing Canadian manufacturers with positive projections associated with company growth, international sales and spending trends.”
According to Statistics Canada, exports of machinery and equipment grew 9.2 — to $7.5 billion in December, the highest level of exports since March 2009. Shipments of aircraft, engines and parts led the gain.
Exports of industrial goods and materials rose 3.8 — to $10.5 billion in December. Shipments of precious metals and alloys, other fabricated materials, as well as iron ores, concentrates and scrap led the gain.
Shipments of auto products were up 6.7 — to $5.8 billion, the highest level since November 2007.
Passenger autos and chassis led the overall increase, posting a fourth consecutive monthly gain as a result of higher volumes.
Energy exports rose 1.7 — to $10.3 billion, with crude petroleum exports hitting as record high of $6.9 billion.
Imports of industrial goods and materials grew 2.6 — to $8.6 billion in December. Imports of automotive products rose 3.6 — to $6 billion on higher volumes. Imports of machinery and equipment increased 1.3 — to $10.9 billion.
Energy imports fell 7.5 — to $4.3 billion, the only sector to decrease in December. It was the second consecutive monthly decrease in the sector.