Canada's exports rise in October

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Canada's exports rise in October

In October, Canada's exports increased largely due to pharmaceutical products, while imports were also up, largely due to the depreciation of the Canadian dollar, data showed on Tuesday.

In October, the country's trade surplus grew to C $1.21 billion $888.53 million, a figure that is slightly above analysts' forecasts of a surplus of C $1.20 billion.

Higher exports of medicinal products and gold bars and coins to the United States helped boost the growth in exports, according to Statscan. Exports were up 0.1% by volume.

Imports rose 0.6%, but were down 0.9% by volume. Motor vehicles and parts as well as metal and non-metallic mineral products drove the gains, while imports of energy products increased, bolstered by incoming U.S. crude oil.

In October, Canada's merchandise trade surplus increased, with a weaker Canadian dollar providing a helping hand. According to Shelly Kaushik, an economist at BMO Capital Markets, trade volumes seem to have added to growth in the month.

A large portion of Canada's trade is done in the U.S. dollars, which means converted values are higher when the Canadian dollar depreciates against the U.S. dollar. Canadian exports fell by 1.3% in October, while imports decreased by 2.2%, according to Statscan.

Despite a big boost from higher agricultural exports, the sector is beginning to struggle with weaker external demand, said Stephen Brown, senior Canada economist at Capital Economics.

Exports of farm, fishing and intermediate food products rose 10.2% in October to a record high C $5.5 billion, helped by canola and wheat. In October, higher exports of canola, oilseeds and wheat led to a 25.4% jump in exports to China, which hit a record high of C $3.3 billion.

The Canadian dollar was trading at 1.3625 to the dollar, or 73.39 U.S. cents, down 0.3% on the day.