Trade surplus widens to $1.4B

Canada's trade surplus widened to $1.4 billion in February from $754 million in January, Statistics Canada said Tuesday.

A 2.8 per cent increase in exports outpaced a 0.9 per cent rise in imports, the data agency said.

Canada's trade surplus is now at its highest level since October 2008, when the economic slowdown was beginning, BMO economist Doug Porter said. Energy has been the main driver of Canadian trade, as exports have now increased in seven of the past nine months, Porter noted.

Exports increased to $34 billion from $33.1 billion the previous month. Industrial goods and materials accounted for over half the growth in exports.

On the import side, imports rose to $32.6 billion from $32.3 billion. Imports have been trending higher since April 2009, the agency said.

Shipments of machinery and equipment, and automotive products increased, offsetting a decline in imports of energy products.

On the strength of automotive products, exports to the United States increased two per cent while imports from the U.S. grew 1.2 per cent. As a result, Canada's trade surplus with the United States widened to $4.4 billion in February from $4.2 billion in January.

Canada's trade deficit with countries other than the United States narrowed to $3 billion in February from $3.4 billion in January, as imports from the world inched 0.2 per cent higher.

"Overall, this report is quite a pleasant surprise for the Canadian economy," Porter said.