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Economy in Brief

U.S. International Trade Deficit Shrinks Unexpectedly in June
by Tom Moeller  July 29, 2020

• Trade deficit in goods narrows to $70.64 billion.

• Exports surge 13.9% while imports rise 4.8%.

• Strength in exports is broad-based.

The advance U.S. trade report showed the goods trade deficit narrowed to $70.64 billion in June from $75.26 billion in May. A deficit of $75.4 billion had been expected in the Action Economics Forecast Survey.

The improvement in exports was led by autos, parts & engines which jumped 144.1% (-38.4% y/y), following three months of sharp decline. Consumer goods exports improved 12.6% (-23.8% y/y) after having risen 5.3% in May. An 11.5% rise (-21.0% y/y) in "other" exports followed three straight months of decline, while capital goods exports improved 11.0% (-22.1% y/y) after falling in four of the prior five months. Exports of industrial supplies & materials rose 9.6% (-25.0% y/y) as oil prices increased. Offsetting these gains was a 5.2% decline (-10.3% y/y) in food & beverage exports, down for the third month in the last four.

The 4.8% gain in imports came on the heels of five consecutive months of decline. It was led by a 107.7% jump (-42.3% y/) in autos & parts, which had fallen for three straight months. Consumer goods imports improved 9.8% (-7.5% y/y) after rising 4.4% in May. Capital goods imports improved 4.6% (-12.6% y/y) after declining in four of the prior five months. Imports of foods, feeds & beverages rose 2.5% (-1.9% y/y) after rising 0.3%. Industrial supplies imports declined 19.2% (-17.4% y/y) while imports of "other" goods fell 4.1% (-33.1% y/y), down for the fourth straight month.

The advance international trade data can be found in Haver's USECON database. The expectation figure is from the Action Economics Forecast Survey, which is in AS1REPNA.

Advance U.S. Foreign Trade in Goods (Customs Value $) Jun May Apr Jun Y/Y 2019 2018 2017
U.S. Trade Deficit ($ bil.) -70.64 -75.26 -70.72 -74.49
-854.37 -872.04 -792.40
Exports (% Chg) 13.9 -5.8 -25.0 -23.9 -1.4 7.7 6.8
Imports (% Chg) 4.8 -0.6 -13.6 -17.2 -1.6 8.5 6.8

Note: Current month is based on Advance Trade data; Previous months reflect revised data from International Trade release.

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