Canada’s trade surplus with the rest of the world rose to $4.1 billion in August as imports fell back from record levels the month before.

The surplus was $3.7 billion in July. Analysts had expected August’s surplus to rise slightly to $3.8 billion, Statistics Canada reported today.

Imports dropped 3.9% to $34.4 billion. It was the first drop in imports since May. Shipments of auto parts from the U.S. into Canada fell to their second lowest level in 10 years, StatsCan said.

“Despite the considerable appreciation of the Canadian dollar against the American dollar since the beginning of 2007, August’s decrease in imports was the result of widespread declines in all sectors except energy products and agricultural and fishing products,” the government agency said.

Exports also fell last month, but by only 1.8%. That allowed the trade surplus to widen. Canadian shipments of industrial goods and materials fell by nine%, while exports of automotive products dropped by six%.

Canada’s trade surplus with the United States widened by $200 million to $6.7 billion.

Year-over year, Canada’s exports to the U.S. have fallen by 3.2% as the rising Canadian dollar makes Canadian goods even more expensive for U.S. buyers.

Meanwhile, the U.S. trade deficit fell to the lowest level in seven months, helped by record-high sales of American products.

The U.S. Commerce Department reported today that the deficit declined to US$57.6 billion in August, down 2.4% from the July imbalance. It was lowest gap between exports and imports since January and a much better showing than had been expected.

The improvement reflected a 0.4% rise in exports, which climbed to a record US$138.3 billion. Sales of farm products including wheat, soybeans and corn, and exports of industrial products such as chemicals and steel both hit record levels.

Imports actually dropped by 0.4% to US$195.9 billion, reflecting lower shipments of foreign cars and furniture, which offset a big increase in the foreign oil bill, which rose to the highest level in a year.

The deficit with China fell by 5.3% to US$22.5 billion. U.S. exports were up, led by increased sales of aircraft and soybeans, while imports slipped a slight 0.7%.