Statistics Canada announced on Thursday that Canada's merchandise trade deficit stood at CAD0.98 billion in February, narrowing from a revised CAD1.66 billion gap in January (originally a CAD1.47-billion gap).

Economists had expected a deficit of CAD1.87 billion.

According to the report, the country's exports rose 0.5 percent m-o-m in February, driven by higher exports of aircraft and other transportation equipment and parts (+18.5 percent m-o-m) and motor vehicles and parts (+3.1 percent m-o-m), which more than offset a plunged in exports of energy products (-7.0 percent m-o-m). Meanwhile, imports decreased 0.8 percent m-o-m in February, led by a slump in imports of energy products (-16.0 percent m-o-m), mainly crude oil. However, higher imports of aircraft and other transportation equipment and parts (+27.3 percent m-o-m) moderated the drop in overall imports.