Canada's third quarter current account gap falls as trade improves

OTTAWA (Reuters) - Canada's current account deficit shrank in the third quarter, but not by as much as expected, as an improvement in trade was partly offset by a higher deficit on cross-border investment flows, according to Statistics Canada data released on Monday. The current account gap fell to C$16.21 billion ($12.10 billion) in the third quarter from C$16.57 billion in the second, sharply revised from an initially reported C$17.40 billion. The figures are seasonally adjusted. The median forecast in a Reuters survey of economists was for a C$15.30 billion deficit in the third quarter. The deficit in the international transactions in goods dropped to C$5.10 billion from C$6.38 billion, while the deficit in trade in services fell by C$148 million to C$5.61 billion. However, the investment income deficit rose to C$4.21 billion from C$3.62 billion. The third quarter also registered an increase in international government transfers abroad, reflecting things like foreign aid. ($1=$1.34 Canadian) (Reporting by Randall Palmer; Editing by Bill Trott)