November 20, 2023

Canadian Trade Surplus Expands While U.S. Trade Deficit Also Grows

Connecting the Dots monitors all major economic announcements in the United States and Canada, but the Metals Service Center Institute also offers industrial metals industry-specific data products that provide much deeper analysis and insight. Visit MSCI’s website and click on industry data to learn more about our Metals Activity Report (MAR), Momentum Monitors, and Economic Pulse.

Meanwhile, here are the major economic headlines from the last week:

  • The U.S. trade deficit widened to $61.5 billion in September, a 4.9 percent increase from August and a number that was higher than economists’ expectations. Increased consumer demand for foreign goods was the biggest factor contributing to the larger gap. Imports were at the highest level since February. The country’s trade deficit remains near a three-year low, however, and is on track for the smallest increase since 2020. Read the full report here.
  • Canada’s merchandise trade surplus more than doubled, from $949 million in August to $2 billion in September, due to higher oil prices that drove up the value of energy exports. Total exports increased 2.7 percent in September, led by a 10 percent rise in energy exports. Total imports were up one percent to $65.0 billion.
  • U.S. industrial production fell 0.6 percent in October. Manufacturing output was down 0.7 percent, due mostly to a 10 percent drop in the output of motor vehicles and parts that happened because of strikes at several major motor vehicle manufacturers. The index for utilities decreased 1.6 percent while output at mines rose 0.4 percent. Total industrial production was 0.7 percent below its average from a year earlier.
  • Canadian manufacturing sales rose 0.4 percent to $72.8 billion in September. Ten of 21 subsectors showed increases in sales, including petroleum and coal product sales (up 6.3 percent) and machinery sales (up 1.3 percent).
  • The Federal Reserve Bank of Kansas City said the manufacturing sector in the Midwest region of the United States continued to contract in November. The bank’s month-over-month composite index was -2 in November, up from -8 in October, but still below the zero margin that separates growth from contraction. The volume of shipments and new orders indexes increased moderately, but the employment and average employee workweek indexes declined slightly. Read more here.
  • U.S. wholesale inventories increased slightly in September, rising 0.2 percent after a 0.1 percent decline in August. The jump was driven by durable goods, which increased 0.2 percent, while inventory of non-durable goods rose 0.1 percent. Wholesale sales jumped 2.2 percent in September, following a strong two percent increase in August.
  • New residential construction in the United States increased 1.9 percent from September 2023 to October 2023, but was down 4.2 percent between October 2022 and October 2023. Residential permits, a gauge of future homebuilding, rose 1.1 percent in October.
  • During the week that ended November 11, 231,000 U.S. residents filed for federal unemployment benefits for the first time, a 13,000 increased from the previous week. The four-week moving average of first-time claims rose as well. During the week that ended November 4, 1.865 million people continued to receive jobless benefits, an increase of 32,000 from the previous week. The four-week moving average of continuing claims also rose.
  • In other economic news: The total monthly value of building permits in Canada fell 6.5 percent in September to $11.2 billion; U.S. import prices declined 0.8 percent in October while prices for U.S. exports fell 1.1 percent; the U.S. Producer Price Index fell 0.5 percent from September 2023 to October 2023, but rose 1.3 percent between October 2022 and October 2023; Real average hourly earnings for all employees increased 0.2 percent from September 2023 to October 2023 and 0.8 percent year-over-year; and the U.S. Consumer Price Index was unchanged in October, but increased 3.2 percent year-over-year.

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