Canada’s merchandise trade balance fell nearly $1 billion in May, the eighth decline in the past 12 months and the largest single monthly drop since February 2001, but economists aren’t too worried.

The trade balance decreased from $5.5 billion in April to just over $4.5 billion in May, in the wake of a decline in exports and an increase in imports. The trade surplus with the U.S. alone plunged $826 million.

“The shrinking balance is really a case of easy come, easy go,” says CIBC World Markets. “After all, exports had been on a tear this year, soaring at an annualized 25% pace in the first four months of the year. At $4.5 billion, May’s merchandise balance is still in very healthy shape and continues to point to a widening in the Q2 current account.”

BMO Nesbitt Burns says that some retreat from the surge in the surplus in April was to be expected. “Exports fell by 1.9% on the month, led by a 6.2% fall in energy exports, as high inventories of natural gas in the U.S. reduced demand. Softness was evident in virtually every major export category, with only industrial goods and materials rising on the strength of metal and alloy shipments,” it notes. And, imports rose for the second consecutive month in June, reflecting the strength of domestic demand.

CIBC also notes that wholesale trade dropped 1.2% in May, “again on a broad-based decline and consistent with the weaker activity in exports and factory shipments.”

“After such a phenomenal April, we were due for a giveback in both merchandise and wholesale shipments,” says CIBC. “And although today’s reports mean May is shaping up as a weak month for growth, even flat readings in May and June would see a 4.5% surge in Q2 annualized GDP at basic prices.”

BMO concludes, “Though the Canadian trade surplus took a greater-than-expected tumble, the level remains healthy. This figure is partly an indicator of the second quarter slowdown in the U.S., and the surplus should perk up as the U.S. economy regains momentum in the second half of the year.”