Lets Go Canada

 

TRENT'S PLACE: Canada's banks are doing extremely well and so is the economy. Look out. USA.

April 13 (Bloomberg) -- Canada posted a fifth straight trade surplus in February, the longest series since November 2008 and another sign of a growing economic recovery. The monthly trade surplus of C$1.4 billion ($1.39 billion) was the largest since October 2008, Statistics Canada said today in Ottawa. A Bloomberg survey of 19 economists
forecast a surplus of C$600 million, according to the median estimate.
The recovery in the country’s trade surplus comes after other reports this year have shown gains in housing and wholesale sales and a drop in unemployment. Bank of Canada Governor Mark Carney has said that output and a key measure of inflation have been higher than he expected, and some economists predict he will start raising his policy interest rate as early as June from today’s record low 0.25 percent.
“It’s a very positive report because it was an improvement for the right reasons,” said Krishen Rangasamy, an economist at CIBC World Markets in Toronto. “You had improvement because exports rose, not because imports fell.”
Exports rose 2.8 percent to C$34 billion in February, led by a 7.2 percent gain in industrial goods and automotive products. Imports rose 0.9 percent to C$32.6 billion, as gains in machinery and equipment and autos were blunted by a 14 percent drop in energy.
The Canadian currency was little changed at C$1.0033 per U.S. dollar at 9:42 a.m. in Toronto, compared with C$1.0025 yesterday.
Rebounding Demand
Potash Corp. of Saskatchewan Inc., the world’s largest producer of its namesake crop nutrient, said March 11 that first-quarter profit will be higher than it previously expected as demand rebounds.
Canada’s merchandise trade surplus with the U.S., its largest trading partner, widened to C$4.4 billion in February from C$4.16 billion in the prior month.
A stronger Canadian dollar and a low volume of U.S. orders will hamper the country’s shipments abroad this year, the Bank of Canada said in January. The Canadian dollar has risen 22 percent against its U.S. counterpart over the past 12 months, making the country’s goods more expensive abroad and imports more attractive in Canada.
Statistics Canada also lowered its estimate of the January trade surplus to C$754 million from an initial reading of C$799 million.
To contact the reporter on this story: Greg Quinn in Ottawa at gquinn1@bloomberg.net.
Last Updated: April 13, 2010 09:56 EDT