The deficit on trade in goods narrowed CAD 0.3 billion to CAD 2.2 billion in the third quarter, as exports strengthened more than imports. The trade surplus with the United States was up CAD 1.7 billion, largely accounted for by exports of energy and automotive products. However, the trade deficit with other countries expanded to CAD 14.5 billion as exports were down CAD 1.2 billion and imports were up slightly.
The overall deficit on transactions in services narrowed CAD 0.3 billion to CAD 5.9 billion in the third quarter. The travel deficit was reduced CAD 0.2 billion, in line with higher spending in Canada by foreign travellers. In addition, lower imports of commercial services resulted in a slightly higher surplus in this account.
The deficit on cross border investment income flows was down CAD 0.6 billion to CAD 5.9 billion in the third quarter. This reflected declines in the direct investment account and gains in the portfolio account.
On the payments side, earnings of foreign direct investors in Canada fell by CAD 0.3 billion, while interest paid to foreigners on their holdings of Canadian securities was up CAD 0.1 billion, mainly related to corporate bonds.
On the receipt side of the ledger, earnings by Canadian direct investors declined by CAD 0.1 billion. At the same time, dividends received by Canadian portfolio investors were up CAD 0.2 billion.