By Promit Mukherjee

OTTAWA, May 5 (Reuters) – Canada’s merchandise trade balance swung to a surplus in March as higher crude oil prices and surging demand for gold ‌drove a sharp jump in exports while imports declined, data showed on Tuesday.

Statistics ‌Canada said the country posted a C$1.78 billion ($1.31 billion) surplus in March, compared with a C$5.11 billion deficit in ​the prior month.

It was the first time in six months that Canada posted a surplus as the war in Iran boosted crude oil prices lifting the value of exports from Canada. While gold prices fell, global demand for the precious metal helped boost exports further.

Analysts polled by ‌Reuters had forecast a deficit ⁠of C$2.88 billion.

Total exports rose 8.5% to C$72.8 billion, aided by a 24% increase in metal and non-metallic product export category to a record ⁠high and 15.6% increase in energy exports, which scaled its highest level since September 2022, StatsCan said.

Barring these two categories, Canada’s exports posted a modest 1.1% increase in value terms and slipped 0.3% ​in ​volume terms.

Following a 24.9% increase in February, exports ​of motor vehicles and parts rose ‌4.5% in March, the statistics agency said.

U.S. SURPLUS

Higher crude oil prices and increased shipments of passenger cars and light trucks drove Canada’s exports to the U.S. by 8.3% to C$48.51 billion in March, its highest level in a year. Imports from the U.S. dropped by 1.2% to C$41.44 billion.

Canada’s trade surplus with the U.S. reached its highest in six months to ‌C$7.1 billion and its share of exports to the ​U.S. dropped to 66.7%, its lowest ever.

President Donald Trump ​has slapped a range of tariffs ​on Canada, as he has tried to shrink his country’s trade deficit ‌with its neighbor.

Canada’s exports to countries other ​than the U.S. hit ​yet another record high in March. Exports to non-U.S. countries rose 9.1% in March while imports from countries other than the United States fell 2.2% in March, data ​showed.

The Canadian dollar rose ‌0.03% to 1.3620 after the trade data. Money markets are pricing in two 25 ​basis point rate cuts by the end of the year.

(Reporting by Promit ​Mukherjee; Editing by Dale Smith and Louise Heavens)