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Economy in Brief

U.S. Trade Deficit Deepens; Exports & Imports Fall by Record Amounts in April
by Tom Moeller  June 4, 2020

• The foreign trade deficit in goods & services added to its March deterioration.

• Exports declined sharply as recessions abroad continued.

• Imports fell precipitously with lower oil prices & developing U.S. recession.

The U.S. trade deficit in goods and services widened to $49.41 billion during April from $42.34 billion in March, revised from $44.42 billion. A $45.2 billion deficit had been expected in the Action Economics Forecast Survey. Earlier figures were revised due to benchmark revisions. Exports declined a record 20.5% (-27.7% y/y) following a 10.2% shortfall. Imports fell 13.7% (-22.4% y/y), also a record drop following three straight monthly declines. These series begin in 1992.

The trade deficit in goods deepened to $71.84 billion last month as goods exports fell by one-quarter (-30.0% y/y). Auto exports fell by two-thirds (-71.1% y/y) and nonauto consumer goods exports fell 29.7% (-39.5% y/y). Imports of goods were off 13.6% (-20.1% y/y). Petroleum imports fell 48.8% (-65.4% y/y) as the price of crude oil fell to $34.72 per barrel. Nonpetroleum imports were off 11.3% (-15.9% y/y). Auto imports declined 52.2% (-57.0% y/y) and capital goods imports fell 10.7% (-13.7% y/y). Nonauto consumer goods imports weakened 6.6% (-20.2% y/y).

The services trade surplus shrank to $22.43 billion, the second consecutive sharp monthly deterioration. A 10.7% decline (-23.5% y/y) in exports reflected a 43.7% collapse (-72.8% y/y) in travel which was accompanied by a 1.7% drop (-0.9% y/y) in charges for intellectual property. Imports of services declined 14.0% (-31.6% y/y) reflecting a three-quarters cutback in travel imports (-92.2% y/y) with travel restrictions imposed as early as January 31, 2020. Intellectual property imports fell 10.0% (-17.8% y/y), the fourth consecutive sharp monthly decline.

The goods trade deficit with China widened to $26.0 billion (SA) in April from $17.0 billion in March. U.S. exports to China rose 28.8% (9.4% y/y) while imports increased 45.7% (-9.2% y/y). The trade deficit with the European Union eased to $14.3 billion (SA). Exports to the EU were off 27.8% (-27.5% y/y) while imports weakened 21.8% (-18.5% y/y. The trade deficit with Japan narrowed to $3.6 billion (SA), its least in roughly two years, as exports to Japan fell 11.3% (-5.3% y/y) while imports from Japan dropped 17.0% (-25.5% y/y).

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

Foreign Trade in Goods & Services (Current $) Apr Mar Feb Apr Y/Y 2019 2018 2017
U.S. Trade Deficit ($ bil.) 49.41 42.34 34.67 49.20
(4/19)
576.86 579.94 513.79
Exports of Goods & Services (% Chg) -20.5 -10.2 0.6 -27.7 -0.4 6.4 6.7
Imports of Goods & Services (% Chg) -13.7 -5.6 -2.4 -22.4 -0.5 7.5 6.7
  Petroleum (% Chg) -48.8 -22.5 -1.7 -65.4 -14.0 20.8 27.2
  Nonpetroleum Goods (% Chg) -11.3 -0.3 -2.7 -15.9 -0.4 7.4 5.5
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