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Economy in Brief

U.S. Trade Deficit Shrinks to Lowest Since January 2010
by Tom Moeller  February 8, 2013

The U.S. foreign trade deficit during December improved to $38.5 from little-revised $48.6B in November. A $46.0B deficit had been expected. The latest deficit was the least since January 2010. The improvement was due to a 2.1% increase (4.9% y/y) in exports and a 2.7% decline (-2.0% y/y) in imports. In chained 2005 dollars, the deficit in goods improved to $44.1B, its least since March 2010. Real exports jumped 2.6% (2.7% y/y) while real imports plunged 3.1% (-1.1% y/y).

In December, the increase in real exports was led by a 9.5% jump (4.7% y/y) in industrial supplies, mostly petroleum products, and a 1.1% increase (-6.8% y/y) in foods, feeds & beverage exports. The constant dollar value of motor vehicle exports fell 2.4% (+1.4% y/y); real exports of nonauto consumer goods exports declined 1.4% (+1.1% y/y) and real capital goods exports were off 0.9% (+2.7% y/y). Services exports jumped 1.1% (7.9% y/y) as the weaker dollar encouraged visits to the United States. The gain was led by a 3.4% rise (13.5% y/y) in passenger fares while travel exports rose 0.9% (14.4% y/y).

Leading the decline in imports was an 11.0% drop (-20.9% y/y) in the value of petroleum imports. The quantity of petroleum product imports was off 7.2% m/m and it was down 17.5% y/y. The price of crude oil fell to $95.16 from $97.45. Real imports less petroleum fell 1.6% in December (+2.4% y/y), led by a 3.9% decline (+3.5% y/y) in autos. Real capital goods imports slipped 0.4% (+1.4% y/y) but nonauto consumer goods imports ticked up 0.2% (4.4% y/y). Nominal services imports slipped 0.3% (-0.2% y/y) as travel imports fell 2.3% (-1.6% y/y) though passenger fares gained 2.4% (4.2% y/y).

By country, the December goods trade deficit with mainland China fell sharply m/m to $24.5B. Exports to China rose 6.8% y/y and U.S. imports increased 6.0% y/y. With Japan, the deficit eased to $5.7 billion. U.S. exports rose 11.4% y/y while imports fell 2.2% y/y. The deficit with the European Union reversed two months of deepening and shrank to $8.7B. U.S. exports fell 5.0% y/y while imports were off 6.5%.

The international trade data can be found in Haver's USECON database. Detailed figures are available in the USINT database. The expectations figures are from the Action Economics consensus survey, which is carried in the AS1REPNA. 


Foreign Trade (Current Dollars) Dec Nov Oct Y/Y 2012 2011 2010
U.S. Trade Deficit $-38.5B $48.6B $42.1B $51.7B
$540. $559.9B $494.7B
Exports (%) 2.1 1.0 -3.5 4.9 4.4 14.2 16.7
Imports -2.7 3.7 -2.1 -2.0 2.7 13.9 19.5
  Petroleum -11.0 -2.5 7.2 -20.9 -5.5 30.7 32.5
  Nonpetroleum goods -1.5 6.2 -4.4 2.5 5.2 12.1 20.8
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