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Economy in Brief
U.S. Housing Affordability Declines Further in June
The NAR Fixed Rate Mortgage Housing Affordability Index fell 3.6% in June...
EMU Output Makes Solid Gain in June
The European Monetary Union posted a 0.7% increase for industrial output in June...
U.S. Producer Prices Fall During July; Core Increase Weakens
The Producer Price Index for Final Demand fell 0.5% during July...
U.S. Unemployment Claims Continue on an Uptrend
Initial claims for unemployment insurance filed in the week ended August 6 rose 14,000 to 262,000...
RICS Survey Points to More U.K. Housing Sector Weakness
The survey of housing market conditions in the U.K. continues to show strength in prices versus weakness...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
by Tom Moeller September 13, 2005
The U.S. foreign trade deficit narrowed to $57.9B in July versus the June deficit of $59.4 which was deeper than initially reported. Consensus expectations had been for a deficit of $59.7B. Despite the narrowing, the U.S. trade deficit remained in record territory with the average during the last three months a record $57.8B.
Adjusted for price inflation, the customs value of the U.S. trade deficit narrowed to $54.6B, the narrowest since March.
Total exports rose a paltry 0.4% following two months of having been roughly unchanged. The 0.5% (10.6% y/y) rise in goods exports last month was again held back by a decline in food, feeds & beverages which fell 2.8% (+9.0% y/y). Capital goods exports rose 0.6% (8.3% y/y) though exports of advanced technology products fell 10.2% (NSA, +8.6% y/y). Nonauto consumer goods exports rose 0.5% (13.0% y/y)
Services exports rose 0.1% (10.1% y/y) for the second month.
The 0.7% decline in imports of goods & services was due mostly to a 2.2% decline in capital goods (+9.5% y/y) and a 2.2% (+7.8% y/y) decline in nonauto consumer goods. Imports of petroleum products rose 5.2% (45.5% y/y) as the average price of crude oil rose to $49.03 per bbl. (46.9% y/y). Imports of non-petroleum goods fell 1.4% (+7.6% y/y).
The US trade deficit with China remained about stable at $17.7B ($161.9B in 2004) but the US trade deficit with Japan improved slightly to $6.6B ($75.6B in 2004). The monthly trade deficit with the Asian NICs also narrowed slightly to $1.2B ($21.9B in 2004) but the deficit with the European Union deepened to $11.2B ($109.3B in 2004).
A Look at China's New Exchange Rate Regime from the Federal Reserve Bank of San Francisco is available here.
Also from the San Francisco Fed, Understanding the Twin Deficits: New Approaches, New Results can be found here.
Foreign Trade | July | June | Y/Y | 2004 | 2003 | 2002 |
---|---|---|---|---|---|---|
Trade Deficit | $57.9B | $59.5B | $51.3B (7/04) | $617.6B | $494.8B | $421.2B |
Exports - Goods & Services | 0.4% | 0.1% | 10.4% | 12.6% | 4.6% | -3.0% |
Imports - Goods & Services | -0.7% | 2.1% | 11.3% | 16.6% | 8.5% | 2.1% |