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Economy in Brief

U.S. Trade Deficit Balloons to a Record $109.80 Billion in March
by Winnie Tapasanun  May 4, 2022

• Exports and imports at their record-high levels.

• Broad-based gains in goods exports and good imports.

• Petroleum imports rise for the third straight month; nonpetroleum imports post a record m/m gain.

• Real goods trade deficit rises to $137.83 billion, a record high.

The U.S. trade deficit in goods and services (BOP basis) widened to $109.80 billion in March from a revised $89.80 billion in February (originally $89.19 billion) and $89.23 billion in January, according to the U.S. Census Bureau. The March deficit was well above the $71.40 billion in March 2021. A $107.0 billion deficit had been expected in the Action Economics Forecast Survey. Exports advanced 5.6% m/m (17.7% y/y), the fifth monthly rise in six months to a record-high level, on top of a 1.9% gain. Imports jumped 10.3% (27.0% y/y) after a 1.6% rise, registering the largest of eight straight m/m gains to a record-high level in March.

The trade deficit in goods (customs value) widened to a record $127.12 billion in March from $106.67 billion in February. It compared to a $125.32 billion deficit in the advance report released on April 27. Exports of goods rose 7.0% (18.0% y/y), the fastest m/m rise since October, after a 1.8% rebound, led by broad-based gains of 12.4% (31.0% y/y) in industrial supplies, 12.1% (10.4% y/y) in other goods, 8.4% (1.5% y/y) in autos, 5.4% (11.9% y/y) in foods, feeds & beverages, 2.1% (20.8% y/y) in nonauto consumer goods, and 1.5% (9.3% y/y) in capital goods. Imports of goods jumped 11.9% in March (26.3% y/y), the largest m/m gain since July 2020, after a 0.8% rise, led by widespread increases of 17.4% (51.3% y/y) in industrial supplies, 13.6% (25.9% y/y) in nonauto consumer goods, 10.7% (8.0% y/y) in autos, 7.5% (18.4% y/y) in capital goods, 6.9% (9.9% y/y) in other goods, and 6.4% (25.3% y/y) in foods, feeds & beverages.

Petroleum imports rose 7.0% (60.4% y/y) in March, the third consecutive m/m rise, after an 18.8% jump in February. Nonpetroleum imports surged a record 12.4% (23.9% y/y), reversing a 0.6% decline.

The real (inflation-adjusted) goods trade deficit ballooned to a record $137.83 billion (chained 2012 dollars) in March from $115.96 billion in February. Real exports of goods rebounded 2.6% (1.4% y/y), the first m/m gain since December, after a 0.6% decline. Real imports of goods recovered 9.8% (13.8% y/y) following a 0.9% drop. The wider deficit subtracted 3.2%-pt. from Q1 2022 GDP growth.

The surplus on services trade rebounded to $18.34 billion in March from $17.98 billion in February. The surplus remained significantly below a high of $26.72 billion in January 2018. Services exports rose 1.8% (15.4% y/y), the sixth m/m rise in seven months, on top of a 1.9% rebound. Services imports grew 1.7% (30.0% y/y) after a 5.5% February gain and two successive monthly drops.

The goods trade deficit with China deepened to a seasonally adjusted record $48.64 billion in March from $41.21 billion in February. Exports fell 0.8% (+6.5% y/y) while imports jumped 13.5% (19.4% y/y). The trade deficit with Japan rose to $6.08 billion from $5.12 billion as exports fell 4.8% (+15.3% y/y) and imports rose 5.1% (15.1% y/y). The goods trade deficit with the European Union declined to $15.61 billion in March from $16.95 billion in February with exports up 8.3% (40.8% y/y) and imports up 1.9% (18.1% y/y).

The international trade data, including relevant data on oil prices, 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 in AS1REPNA.

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