Canadian exports and imports both fell in August after gaining slightly in July, Statistics Canada said Friday.

Exports declined 5.1 per cent while imports sank 2.8 per cent during the month, causing the country's trade deficit to widen to $2 billion in August from $1.3 billion in July.

Canadian exports and imports sank in August, pushing Canada's trade deficit with other countries to $2 billion, Statistics Canada said Friday. (Philip Scott Andrews/Associated Press)

After two consecutive months of increases, exports fell to $29.2 billion in August from $30.8 billion in July.

The decline was spread across all sectors, led by machinery and equipment, agricultural and fishing products, industrial goods and materials, and automotive products.

Following a 9.4 per cent gain to $32.1 billion in July, imports declined to $31.2 billion in August. Machinery and equipment accounted for half of the decrease, although energy products, other consumer goods, and industrial goods and materials also contributed. Gains in imports of automotive products moderated the decline.

Since reaching record highs in July 2008, exports and imports have generally been trending downward. Export volumes have fallen by 21.3 per cent and prices have declined by 16.3 per cent. In comparison, import volumes have fallen by 18.1 per cent while prices have decreased by 3.5 per cent.

Exports to the United States fell 3.2 per cent while imports declined 3.3 per cent in August. As a result, Canada posted a trade surplus with the United States of $2.2 billion, basically unchanged from July.

Exports to countries other than the United States decreased 10.6 per cent. Imports declined two per cent, mostly as a result of lower imports from the European Union.

Consequently, Canada's trade deficit with countries other than the United States increased to $4.2 billion in August from $3.5 billion in July.