Canada's Trade Troubles Deepen Amid Falling Exports

Canada witnessed a significant widening of its merchandise trade deficit in August, hitting C$6.32 billion, marking its second-highest record. The decline came as exports to both the United States and the rest of the world plummeted, fueled largely by the impact of tariffs imposed by U.S. President Donald Trump, data revealed Tuesday.

Exports plummeted by 3% from July, with imported goods experiencing a slight uptick of 0.9%, according to Statistics Canada. This decline marks the first decrease reported since April, with the volume of exports falling by 2.8%. Analysts had forecast a lower deficit of C$5.55 billion but were taken aback by the sharp increase.

With key export sectors like forestry and industrial machinery facing downturns, Prime Minister Mark Carney faces pressure to address the declining trade conditions. Meanwhile, Canada's exports to non-U.S. countries shrank for the third consecutive month, contributing to a record trade deficit of C$12.8 billion with these nations.

(With inputs from agencies.)