US, Canadian Trade Deficits Increase Less than Expected

The goods and services trade deficit in the United States came in at $67.4 bill in December, increasing by $6.4 billion in comparison to October’s revised figure, the U.S. Bureau of Economic Analysis and the Census Bureau shared in their final report on Tuesday.

In December, exports stood at $250 billion, down by $2.2 billion in comparison to the month prior, while imports rose by $4.2 billion, totaling $317.6 billion. The goods deficit was up by $7.4 billion to $90.6 billion, while the services surplus grew $1 billion to $23.2 billion.

For the entire 2022, the goods and services deficit increased by 12.2% or $103 billion in comparison to the year before, amounting to $948.1 billion. Exports skyrocketed by 17.7% to reach $3.01 trillion, while imports jumped 16.3% to a total of $3.96 trillion.

Canadian International Merchandise Trade, December 2022

In December, Canada’s merchandise exports decreased 1.2%, mostly on lower exports of energy products. Meanwhile, imports were down 1.3%, mainly driven by lower imports of consumer goods.

As a result, Canada’s merchandise trade deficit with the world narrowed from $219 million in November to $160 million in December.

These narrow trade balances are within the typical bounds for monthly revisions to imports and exports.

Total exports fell 1.2% to $63.0 billion in December, the lowest since February 2022. Declines were observed in 7 of the 11 product sections, with exports of energy products leading the decreases. However, excluding energy products, exports posted an opposite movement, increasing by 0.8%. Total exports in real (or volume) terms were also up, rising 0.9% in December.

Total imports fell 1.3% to $63.1 billion in December, the lowest level since March 2022. Decreases were observed in 7 of the 11 product sections, but the decline in imports was largely attributable to negative movements in the consumer goods and motor vehicles and parts product sections. In real (or volume) terms, total imports fell 1.9%.