08:43 AM EDT, 10/09/2024 (MT Newswires) -- Canada's merchandise trade deficit widened in August, marking the sixth straight month in the red after revisions wiped away the July surplus, said Bank of Montreal (BMO).

Unsurprisingly, the deterioration was driven by lower energy shipments -- which make up the largest share of total exports, noted the bank. That comes alongside a drop in oil prices, which was extended in September.

Even with the additional capacity from the expanded Trans Mountain pipeline, exports -- and the broader trade balance -- are susceptible to swings in oil prices.

Luckily, it is trade volumes that matter for the growth picture --in other words, removing the impact of prices, stated BMO.

However, here, too, the picture was unsupportive as exports

with a 0.1% month-over-month rise were outpaced by imports of 0.4% month-over-month increase.

So far, it looks like trade won't do much for Q3 growth, highlighting what is ultimately a soft backdrop for the Canadian economy, added the bank.