Canada’s trade deficit narrowed in May after hitting record high in April

According to Statistics Canada, the country’s trade deficit narrowed to 5.9 billion Canadian dollars ($4.34 billion) in May, following April’s record high. The decline was driven by a 1.1% increase in exports and a 1.6% drop in imports, despite the negative impact of US tariffs.

Shipments to the US, Canada’s key trading partner, decreased for the fourth straight month (-0.9%). However, this drop was partly offset by a record surge in exports to other countries (+5.7%). The statistics agency also highlighted a sharp increase in gold sales to the UK.

However, excluding metals and minerals, Canada’s exports actually fell by 1.2%. Meanwhile, overall imports dropped to 66.66 billion Canadian dollars ($49.12 billion), including a 1.2% decline in shipments from the US.

Tensions between Canada and the US remain high, with current tariffs putting a strain on bilateral trade. In an effort to ease tensions, Canadian Prime Minister Mark Carney and US President Donald Trump are negotiating a deal, which both countries hope to finalize by July 21.