The trade deficit in November came in at USD 1.4 billion, widening by USD 0.7 billion with respect to November 2023. The trade deficit was above the Bloomberg market consensus of USD 1.3 billion and our USD 1.0 billion call. Total imports (FOB) rose by 12% (+4.9% in October), boosted by imports of transport equipment and manufacturing, but partially countered by fuel imports. Meanwhile, exports fell 1.8% yoy in November (+3.8% in the previous month), dragged by coal and oil exports. As a result, the rolling 12-month trade sits at USD 10.5 billion (USD 9.7 billion in 2023; USD 14.5 billion in 2022). At the margin, our seasonal adjustment shows the trade deficit at USD 10.8 billion (annualized; USD 9.8 billion recorded in 3Q24).
Imports continued to rebound during the latter part of 2024. The 12% yoy increase was boosted by transport equipment (+48.7% yoy), construction materials (+30.6% yoy), durable consumption goods (+30.8%) and non-durable consumption goods (+11.6%; mainly food products). In the quarter ending November, imports increased 6.5% yoy (+5.6% in 3Q24). Imports excluding fuels and transportation equipment rose from last year 13.8% (+12% yoy in 3Q24). At the margin, we estimate imports increased 18% qoq/saar (-15.5% in 3Q24; +46.5% in 2Q24). The US accounted for 26.7% of total imports in the month.
Commodities drag exports in November. Exports fell by 1.8% yoy (+3.8% previously). While coffee sales continued to recover, boosted by prices, coal and oil exports posted declines of 9.3% YoY and 9.6% YoY, respectively. In contrast, non-traditional exports continued to expand (+3.1% YoY; +27% YoY in October). At the margin, exports grew by 17.8% qoq/saar (8.1% in 3Q24; +5.3% in 2Q24; -16.4% in 1Q24). US accounted for 27.7% of total exports in the month.
Our take: The domestic demand recovery and weak commodities exports have led to a slight widening of the trade deficit. Nevertheless, we expect the CAD deficit to remain low at 2.0% of GDP in 2024, amid elevated remittances.
