The U.S. foreign trade deficit deepened more than expected in June to $58.8B versus May's deficit of $55.4 which was little revised. Consensus expectations had been for a deficit of $57.2B.

Total exports were unchanged for the second consecutive month. Goods exports were again unchanged (13.0% y/y), last month held back by a 7.0% decline in food, feeds & beverages and a 2.2% (+12.2% y/y) drop in nonauto consumer goods. Capital goods recovered 1.9% (12.4% y/y) after the prior month's decline. Exports of advanced technology products jumped 12.2% (NSA, 10.3% y/y) after two months of decline.

Services exports rose 0.2% (13.7% y/y).

Imports of goods & services rose 2.1% as imports of capital goods jumped 4.0% (11.2% y/y). Imports of petroleum products rose 9.8% (31.9% y/y) due to a 3.1% rise in the average price of crude oil to $44.40 per bbl. (31.6% y/y). Imports of non-petroleum goods rose 1.3% (8.6% y/y).

The US trade deficit with China deepened further to $17.6B ($161.9B in 2004) and the US trade deficit with Japan deepened to $6.9B ($75.6B in 2004) following two months of improvement. The monthly trade deficit with the Asian NICs deepened to $1.3B ($21.9B in 2004) and the deficit with the European Union deepened to $10.8B ($109.3B in 2004).

Foreign Exchange Rates Are Predictable! from the Federal Reserve Bank of St. Louis is available here.

International Perspectives on the "Great Moderation" from the Federal Reserve Bank of St. Louis can be found here.