U.S. Trade Deficit Narrows Sharply in April as Imports Plummet

The U.S. trade deficit in goods and services (BOP basis) in April declined to $61.6 billion after increasing to a record $138.3 billion in March, revised from $140.5 billion and falling to 122.0 billion in February, revised from $123.2 billion, according to the U.S. Census Bureau. A $70 billion deficit was expected by the Action Economics Forecast Survey. Exports rose 3.0% (8.6% y/y) after rising 0.9% in March, revised from 0.2%, and increasing 2.3% in February, revised from 2.8%. This was accompanied by a 16.3% decline (+3.4% y/y) in imports which followed a 4.7% rise in March, revised from 4.4% and came after a 0.5% slip in February, revised from no change.

The trade deficit in goods (BOP basis) narrowed to $87.4 billion from a record $162.6 billion, revised from $163.2 billion, in March. Goods exports (customs value) rose 3.5% (9.9% y/y) in April, after increasing 2.6% in March. The latest increase reflected a 16.0% rise (24.0% y/y) in industrial supplies & materials exports which followed a 4.5% rise. Exports of “other” goods rose 4.7% (11.9% y/y) following a 7.5% gain, while capital goods exports increased 1.7% (11.9% y/y) following a 1.4% drop. Working lower, auto exports fell 21.5% (-19.2% y/y) after increasing 7.0% in March. Foods, feeds & beverage exports declined 3.8% (-0.1% y/y) after rising 8.6%. Nonauto consumer goods exports were off 7.0% (-8.3% y/y) in April after slipping 0.3% March.

Imports of goods decreased 19.9% (+2.5% y/y) in April after a 5.7% March increase. Nonauto consumer goods imports were off 32.0% (+5.2% y/y) after a 27.6% March gain. Imports of industrial supplies & materials worked 31.0% lower (-5.5% y/y), down for the third straight month. Auto imports fell 20.0% (-19.7% y/y) after a 9.2% rise. Capital goods imports fell 3.0% (+16.5% y/y) and followed a 4.1% rise. Foods, feeds & beverage imports declined 4.4% (+5.7% y/y) following a 0.2% improvement. “Other” goods imports declined 3.3% (+5.1% y/y) after a 0.8% rise. Petroleum imports by end-use fell 11.5% (-23.8% y/y) after a 4.2% decline. Nonpetroleum imports fell 20.4% (+4.7% y/y) after rising 6.3% in March.

The inflation-adjusted goods trade deficit (customs value) narrowed to $85.6 billion in April after deepening to 150.1 billion in March. Real exports rose 3.1% (8.7% y/y) after a 2.9% March increase, while real imports slumped 19.9% (+2.2% y/y) in April following a 6.1% March increase.

The services trade surplus rose to $25.8 billion in April after decreasing to $24.3 billion in March. It reached a peak of $26.9 billion in March of last year. Service exports rose 2.1% (5.9% y/y) after a 0.9% decline in March. Construction services exports rose 2.4% (11.0% y/y) in April after increasing 2.0% in both of the prior two months. Travel services exports increased 8.0% (7.3% y/y) and financial exports increased 1.1% (3.6% y/y). Transport exports eased 0.7% (+6.0% y/y). Service imports rose 0.7% (8.3% y/y) in April following a 0.1% gain. Maintenance & repair services jumped 20.0% (12.7% y/y) after declines in each of the prior three months, while imported transport services fell 3.4% (+3.9% y/y) after a 0.8% rise. Imported travel services rose 2.0% (10.2% y/y) while charges for use of intellectual property rose 2.5% (4.6% y/y).

The U.S. goods trade deficit with China narrowed to a seasonally adjusted $19.7 billion in April from $24.2 billion in March. Exports to China declined 19.7% (-29.2% y/y) while imports weakened 18.9% (-19.2% y/y). The deficit with the European Union narrowed to $17.9 billion in April from the record $48.0 billion in March. Exports rose 2.8% (13.1% y/y) while imports dropped 35.6% (-0.6% y/y). The deficit with Japan narrowed to $5.8 billion from $6.1 billion in March. Exports rose 2.9% (10.9% y/y) and imports eased 0.3% (+6.2% y/y) in April.

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 and USTRADE databases. The expectations figures are from the Action Economics Forecast Survey are in AS1REPNA.