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Economy in Brief

U.S. Trade Deficit Is Shallower
by Tom Moeller  September 3, 2015

These foreign trade figures add to the preliminary numbers released last Friday by including trade in services and by country.

The U.S. foreign trade deficit in goods and services during July eased to $41.9 billion from $45.2 billion in June, revised from $43.8 billion. A deficit of $42.0 billion had been expected in the Action Economics Forecast Survey. In constant dollars, the trade deficit in goods shrank to $56.2 billion from $59.0 billion in June. Real exports of goods improved 0.9% (-0.6% y/y) while real goods imports eased 0.9% (+4.2% y/y).

Overall, exports improved 0.4% in July (-4.2% y/y) after a 0.1% June dip. Goods exports increased 0.8% (-6.8% y/y) as auto exports jumped 4.7% (-9.7% y/y) following a 0.3% gain. Foods, feeds & beverage exports improved 1.7% (-8.4% y/y) after a 4.0% decline. Industrial supplies & materials exports gained 0.8% (-13.2% y/y) on the heels of a 1.8% decline and capital goods exports nosed 0.4% higher (-3.9% y/y) following two months of sharp decline. To the downside were nonauto consumer goods exports which posted a 2.5% decline (-0.4% y/y). That reversed half of the prior month's increase. Services exports improved 0.3% (3.1% y/y) as travel exports also gained 0.3% (4.2% y/y).

Imports fell 1.1% (-3.3% y/y) and reversed a 1.1% increase during June. Nonpetroleum goods imports declined 1.4% (+0.9% y/y). Foods, feeds & beverages imports fell 5.3% (-2.7% y/y) and reversed most of the June rise. Nonauto consumer goods imports were off 5.2% (+4.4% y/y), reversing the prior month's increase. Moving higher were automotive vehicles & parts imports by 1.1% (6.0% y/y) and that added to two months of strong increase. Industrial supplies & materials imports rose 0.9% (-25.3% y/y) after a 2.9% drop. Capital goods imports gained 0.5% (-0.5% y/y) following three months of sharp decline. Imports of services improved 0.5% (2.6% y/y) as travel imports increased 1.2% (7.9% y/y).

Petroleum imports increased 2.1% in July (-39.5% y/y) after a 9.3% increase. In constant dollars, petroleum imports rose 1.9% (4.6% y/y). The average per barrel cost of crude oil rose slightly to $54.20 (-44.6% y/y). The value of energy-related petroleum product imports increased 4.6% (-41.2% y/y) as their quantity rose 4.5% (2.0% y/y).

By country, the trade deficit in goods with China edged lower m/m to $31.6 billion, its deepest since October. Exports to China rose 2.3% y/y while imports from China also gained 2.3% y/y. The deficit with Japan deepened to $5.7 billion. Exports to Japan declined 2.9% y/y and imports from Japan fell 4.7% y/y. The trade deficit with the European Union deepened m/m to $15.2 billion. Exports to the EU declined 7.2% y/y while imports from the EU were little-changed 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 Forecast Survey, which is carried in the AS1REPNA.

Bubbles and Fools from the Federal Reserve Bank of Chicago can be found here.

Foreign Trade in Goods & Services (Current Dollars) Jul Jun May Y/Y 2014 2013 2012
U.S. Trade Deficit $41.9 bil. $45.2 bil. $42.5 bil. $41.4 bil.
$508.3 $478.4 bil. $536.8 bil.
Exports (% Chg) 0.4 -0.1 -0.7 -4.2 2.8 2.7 4.3
Imports -1.1 1.1 -0.4 -3.3 3.4 0.1 3.0
  Petroleum 2.1 9.3 -0.4 -39.5 -9.6 -11.0 -5.5
  Nonpetroleum -1.4 0.5 -0.7 0.9 6.1 2.0 5.2
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