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Economy in Brief

U.S. Trade Deficit Narrows Sharply As Exports Jump and Imports Slide
by Tom Moeller  August 6, 2013

The U.S. foreign trade deficit fell sharply during June to its shallowest level since October 2009. The $34.3 billion deficit compared to a revised $44.1 billion in May, initially reported as $45.0 billion. A $43.5 billion deficit had been expected in the Action Economics survey. The 2.2% jump (3.2% y/y) in exports led the deficit's improvement after a 0.3% May slip. Imports, conversely, slumped 2.5% (-1.0% y/y) after a 1.5% rise. In chained 2009 dollars, the deficit in goods shrank to $43.1 billion. Real exports gained 3.2% (1.9% y/y) while real imports fell 3.0% (-0.7% y/y).

The constant dollar value of nonauto consumer goods exports jumped 6.9% (17.8% y/y) while real exports of industrial supplies advanced 3.5% (1.0% y/y). Real exports of foods, feeds and beverages increased 3.2% (-13.0% y/y) and the constant dollar value of capital goods exports jumped 3.3% (4.7% y/y). Real motor vehicle exports, however, declined 3.4% (-0.6% y/y). Services exports inched up 0.2% (5.8% y/y). Travel exports rose 0.7% (6.7% y/y) as the dollar's low value prompted more visits to the U.S. from abroad. Passenger fares fell 0.8% (-0.4% y/y).

The value of petroleum imports fell 6.3% (-12.6% y/y) as the quantity of petroleum product imports fell 6.4% m/m (-12.1% y/y. The price of crude oil held roughly steady m/m $96.93 and remained down from the $109.69 high reached last year. Real imports less petroleum declined 2.2% in June (+1.2% y/y). Real imports of foods, feeds & beverages dropped 3.3% (+5.7% y/y). Real consumer goods excluding autos fell 3.6% (+2.8% y/y) and real auto imports slipped 0.9% (+1.6% y/y). The real value of capital goods imports ticked up 0.2% (0.1% y/y). Nominal services imports inched 0.1% lower (+3.2% y/y) but travel imports gained 0.3% (1.8% y/y). Passenger fares rose 1.6% (7.1% y/y) but other transportation services imports fell 1.9% (+5.3% y/y).

By country, the June trade deficit in goods with mainland China eased to $26.6 billion. Exports to China gained 8.3% y/y while U.S. imports slipped 0.3% 4.9% y/y. With Japan, the deficit deepened slightly to $5.5 billion. U.S. exports fell 5.4% y/y while imports were off a greater 6.8% y/y. The deficit with the European Union declined sharply to $7.1 billion, its least since February 2012. U.S. exports fell 1.7% y/y while imports were off 5.2% y/y.

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) Jun May Apr Y/Y 2012 2011 2010
U.S. Trade Deficit $-34.3B $-44.1B $40.1B $42.4B
$534.7B $556.8B $499.4B
Exports (%) 2.2 -0.3 1.3 3.2 4.6 14.5 16.9
Imports -2.5 1.5 2.4 -1.0 2.8 13.9 19.5
  Petroleum -6.3 4.3 -1.5 -12.6 -5.6 30.7 32.5
  Nonpetroleum goods -2.5 1.6 3.5 0.4 5.2 12.1 20.8
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