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Breaking News from The Globe and Mail

TAVIA GRANT

Monday, February 27, 2006

Canada's current account surplus hit a record $13.28-billion in the fourth quarter on higher natural gas and auto exports, Statistics Canada said Monday.

The surplus increased by $5.5-billion in the quarter and surpassed the $12.5-billion analysts had expected. The third-quarter surplus was revised down to $7.76-billion. All figures are seasonally adjusted.

Last year, the current account surplus reached $30.2-billion, surpassing its previous record of $29.3-billion in 2000, the government agency said.

The Canadian dollar strengthened as the report showed strong exports and high commodity prices are buoying economic growth. Further details about the health of Canada's economy will come Tuesday with the release of the fourth-quarter gross domestic product.

Monday's report showed exports rose in the fourth quarter, as higher energy prices increased the value of natural gas exports and auto product shipments grew by more than $1-billion.

Imports, meantime, also increased, led by machinery and equipment, industrial goods and energy products.

The current account measures transactions on exports and interest income against imports and interest expenses.

The Canadian dollar rose to 87.69 cents after the release from Friday's Bank of Canada close of 87.05 cents.

Canada's GDP report tomorrow is expected to show real growth of 2.6 per cent in the fourth quarter.

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