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Economy in Brief

Goods Trade Deficit Widened Slightly in January
by Sandy Batten  February 26, 2021

• A small narrowing had been expected.

• Both exports and imports increased but at a slower pace than in December.

• Net exports begin Q1 on course to be a slight drag on overall GDP growth in Q1.

The advance estimate of the U.S. trade deficit in goods widened slightly to $83.74 billion in January from $83.19 billion in December. The Action Economics Forecast Survey had expected a small narrowing to $82.9 billion deficit. Exports rose 1.4% m/m (-0.7% y/y) after a 4.6% m/m jump in December. Imports increased 1.1% m/m (8.2% y/y), their smallest monthly gain since last September, following a 1.4% m/m advance in December. The small widening in the deficit in January put net exports on a course to exert another slight drag on overall GDP growth in Q1. Net exports subtracted 1.55%-pt from GDP growth in Q4 2020.

The performance of exports in January varied markedly across end-use categories. Exports of industrial supplies and materials jumped up 5.5% m/m, their largest monthly gain since August, and exports of capital goods except autos increased 3.9% m/m. In contrast, auto exports fell 5.0% m/m and exports of foods, feeds and beverages declined 4.5% m/m. The increase in imports in January was led by a 6.4% m/m rise in foods, feeds and beverages and a 5.4% m/m increase in imports of nonfood consumer goods excluding autos. Auto imports fell 4.7% m/m and imports of other goods slumped 12.8% m/m.

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 $) Jan Dec Nov Jan Y/Y 2019 2018 2017
U.S. Trade Deficit ($ bil.) -83.74 -83.19 -86.11 -66.19
(1/20)
-904.94 -854.37 -872.04
Exports (% Chg) 1.4 4.6 1.1 -0.7 -12.9 -1.4 7.7
Imports (% Chg) 1.1 1.4 3.1 8.2 -6.4 -1.6 8.5

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

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