Canada's trade deficit in May narrowed after a record-breaking deficit in April as total exports rose and imports fell even as the impact of U.S. tariffs dented shipments south of the border, data showed on Thursday.

Exports saw a slight rebound in May, despite tariff headwinds. Following a record-low national trade balance in April—coinciding with the introduction of U.S. tariffs on Canadian imports—Canada’s exports showed signs of recovery in May.

Canadian exports heading to the United States continued to dry up in May as trade picked up with other nations, Statistics Canada said Thursday. The agency said Canada's merchandise trade deficit narrowed to $5.