U.S. Trade Deficit Deepens Slightly

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

The U.S. foreign trade deficit in goods and services during June increased to $43.8 billion after a May deficit of $40.9 billion, revised from $41.9 billion. A deficit of $42.7 billion had been expected in the Action Economics Forecast Survey. In constant dollars, the trade deficit in goods deepened to $59.3 billion from $57.6 billion in May. Real exports of goods declined minimally (-0.2% y/y) while real goods imports increased 1.0% (5.5% y/y). During all of the second quarter, improvement in the foreign trade deficit added 0.1 percentage points to real GDP growth. Exports rebounded 5.3% at an annual rate (1.5% y/y) after a 6.0% decline. Imports rose 3.5% (4.9% y/y), adding to a 7.1% rise.

Overall exports eased 0.1% in June (-3.6% y/y) after a 0.7% decline. Goods exports were off 0.2% (-5.4% y/y) as capital goods exports retreated 1.7% (-2.2% y/y). Exports of industrial supplies & materials fell 1.6% (-11.9% y/y) and foods, feeds & beverage exports declined 4.2% (-10.3% y/y). To the upside, auto exports edged 0.5% higher (-5.1% y/y) and nonauto consumer goods exports jumped 5.0% (-0.8% y/y). Services exports improved 0.1% (2.9% y/y) as travel exports gained 0.3% (3.8% y/y).

Imports increased 1.2% (-2.3% y/y) following a 0.5% decline in May. Nonpetroleum goods imports gained 0.7% (2.6% y/y) as foods, feeds & beverages imports jumped 6.3% (5.5% y/y). Industrial supplies & materials imports jumped 2.9% (-22.3% y/y). Automotive vehicles & parts imports rose 1.1% (10.2% y/y) while nonauto consumer goods imports increased 3.5% (14.3% y/y). Moving lower were capital goods imports by 2.6% (+1.7% y/y). Imports of services gained 0.3% (3.5% y/y) as travel imports increased 1.8% (7.1% y/y).

Petroleum imports increased 9.5% in June (-39.3% y/y) after a 0.4% decline. In constant dollars, petroleum imports rose 2.0% (4.5% y/y). The average per barrel cost of crude oil increased to $53.76 (-44.2% y/y). The value of energy-related petroleum product imports increased 11.5% (-38.0% y/y) as their quantity rose 8.3% (7.5% y/y).

By country, the trade deficit in goods with China increased m/m to $31.5 billion, its deepest since October. Exports improved 3.8% y/y while imports gained 4.3% y/y. The deficit with Japan was little-changed at $5.2 billion. Exports declined 6.8% y/y and imports fell 7.0% y/y. The trade deficit with the European Union deepened m/m to $14.5 billion. Exports declined 7.0% y/y while imports increased 4.2% 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 Forecast Survey, which is carried in the AS1REPNA.