As exports to the U.S. increase, Canada's trade deficit narrowed in July.

On September 4, it was reported that Canada's trade deficit narrowed in July, driven by an overall increase in exports, particularly due to crude oil and passenger car exports to the United States. Data shows that Canada's merchandise trade deficit in July was CAD 4.94 billion, down from CAD 5.98 billion the previous month, but still significantly higher than the same period last year. This marks the sixth consecutive month of trade deficits since Trump imposed tariffs on Canada, although it has improved from the record CAD 7.6 billion deficit in April. Following the release of the trade data, the Canadian dollar fell 0.2% against the US dollar. The yield on Canada's two-year bonds dropped by 0.1 basis points to 2.61%.