Forget about getting fresh trade data — the U.S. shutdown is now hitting Canada
Canada’s statistics agency will stop releasing monthly merchandise trade data indefinitely because of the U.S. government shutdown.
Statistics Canada said Thursday the next trade report, due Feb. 5, won’t be published as scheduled. The delay will likely last until after the U.S. Census Bureau resumes normal operations. Since 1990, the Canadian agency has been using U.S. figures to calculate the nation’s exports to its biggest trading partner.
“Trade statistics without Canada’s exports to the U.S. have limited use as a current economic indicator, as these exports represent approximately 75 per cent of Canada’s total exports,” the Ottawa-based agency said on its website.
The lack of merchandise trade data casts a fog over the state of the nation’s economy, and raises the prospect of a prolonged delay handcuffing the Bank of Canada’s ability to properly assess the economic outlook as it considers additional interest rate increases.
“With more U.S. indicators being delayed — especially at the start of the year — it will become more difficult for the Bank of Canada to forecast where the economy and exports are headed in 2019,” Dominique Lapointe, an economist with Laurentian Bank Securities Inc., said from Montreal.
Policy makers, however, had been widely expected to remain on hold for at least the next few months. That means the data gap caused by the shutdown isn’t likely to have an immediate impact on Bank of Canada rate expectations, according to Bipan Rai, head of North American foreign-exchange strategy at Canadian Imperial Bank of Commerce in Toronto.
“The bank seems to be have gotten its message across” on a pause, Rai said by phone.”We don’t expect them to deviate too much from that message, at least in the coming months.”
The shutdown in Washington isn’t just impacting the trade report. Export numbers are also used as inputs for quarterly gross domestic estimates, but Canada’s statistics agency said it will still be able to publish GDP numbers for the fourth quarter as scheduled because it has enough data from October and November to make calculations.
The agency said other options for the trade data may be considered if the U.S. shutdown drags on.
With assistance from Erik Hertzberg.