Overview

• Canada posted a $1.52 billion trade deficit in February 2025, a sharp reversal from its $3.13 billion surplus in January, driven by falling energy and automotive exports.
• Canadian exports dropped 5.5% to $70.11 billion, with energy products down 6.3% and motor vehicles and parts declining 8.8%.
• The U.S. trade deficit narrowed by 6.1% in February to $122.7 billion, supported by record-high exports of $278.5 billion, particularly in industrial supplies and autos.
• Businesses in both nations have been stockpiling inventories to mitigate the anticipated impact of President Trump's 10% baseline tariff on all U.S. imports, set to take effect in April 2025.
• Economic analysts predict slower growth for both economies in early 2025, with Canada's trade imbalance raising concerns and U.S. GDP growth estimates falling below 0.5% for Q1.