Global| Feb 14 2008U.S. Trade Deficit Narrowed Sharply
by:Tom Moeller
|in:Economy in Brief
Summary
The U.S. foreign trade deficit in December narrowed sharply to $58.8B from an unrevised $63.1B during November. The figure compared to Consensus expectations for a deficit of $61.4B and it pulled the annual deficit for 2007 to [...]
The U.S. foreign trade deficit in December narrowed sharply to $58.8B from an unrevised $63.1B during November. The figure compared to Consensus expectations for a deficit of $61.4B and it pulled the annual deficit for 2007 to $771.6B, its lowest since 2004.
For December U.S. exports jumped 1.5%, the largest monthly increase since July. Strong economies abroad and the lower value of the dollar helped exports during all of last year to rise 12.2% after a 12.7% gain in 2006 and a 10.9% rise in 2005.
Exports of goods surged 1.9% in December (14.5% y/y) and for
the full year rose 12.2%. Growth in exports of foods, feeds &
beverages slipped 1.7% in December but for the year this was the
strongest export category with a 27.7% rise. Exports of industrial
supplies & materials also were strong last year and rose 14.3%.
During December exports of capital goods surged 5.2% to finish a year
of 7.8% growth after a 14.2% jump in 2006. Exports of civilian aircraft
rose 20.8% during all of last year while exports of computers jumped
18.3%.Nonauto consumer goods exports also were strong in December. They
rose 4.6% and were firm all year with a 12.6% increase. That was
similar to the gains during the prior three years.
U.S. exports of services slipped 0.3% in December but finished a year of 11.8% growth. That annual gain was paced by 14.1% growth in travel exports and a 12.1% rise in passenger fares.
Overall imports fell 1.1% in December and the annual gain of 5.9% was the weakest since 2002. Higher oil prices did raise petroleum imports by 4.2% in December and by 9.5% for the year, however, that was the weakest annual rise since 2002. Petroleum imports in constant dollars fell as the per barrel price of crude petroleum rose 11.1% for the year. That followed price gains of 23.2% in 2006 and of 36.3% in 2005. Imports of nonauto consumer goods rose 7.3% last year, the weakest gain since 2001 and capital goods imports increased 6.3% for the year, the weakest gain since 2003.
The U.S. trade deficit in goods with China during 2007 deepened to $25.6B from $23.3B. Imports rose 11.7% and exports rose 18.2%, the weakest rise since 2002.
The Economy and Financial Markets is today's testimony by Fed Chairman Ben S. Bernanke and it is available here.
Today's speech by Treasury Secretary Henry M. Paulson, Jr., Economy and Financial Markets, can be found here.
| Foreign Trade | December | November | Y/Y | 2007 | 2006 | 2005 |
|---|---|---|---|---|---|---|
| U.S. Trade Deficit | $58.8B | $63.1B | $60.3B (12/06) |
$711.6 | $758.5 | $714.4B |
| Exports - Goods & Services | 1.5% | 0.5% | 13.6% | 12.2% | 12.7% | 10.9% |
| Imports - Goods & Services | -1.1% | 2.9% | 8.4% | 5.9% | 10.4% | 12.9% |
| Petroleum | 4.2% | 16.3% | 52.4% | 9.5% | 20.1% | 39.6% |
| Nonpetroleum Goods | -2.8% | 0.9% | 0.5% | 4.6% | 9.1% | 10.3% |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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