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Economy in Brief

U.S. Goods Trade Deficit Widened in May
by Sandy Batten  June 24, 2021

• Exports fell while imports rose.

• Still, foreign trade on course to contribute to overall GDP growth in Q2.

The advance estimate of the U.S. trade deficit in goods widened to $88.1 billion in May from $85.7 billion in April. The May deficit was nearly exactly the $88.0 billion shortfall anticipated by the Action Economics Forecast Survey. Exports fell 0.3% m/m (+58.6% y/y) in May following a 1.1% m/m gain in April. By contrast, imports increased 0.8% m/m (+39.2% y/y) in May after a 1.9% m/m decline in April. Even with the widening of the deficit in May, the April-May figures put the deficit on course in Q2 to be narrower than in Q1. Net exports subtracted 1.5%-points from Q1 GDP growth. The April-May figures point to net exports contributing to overall GDP growth in Q2 for the first time in four quarters.

By end-use category, exports of nonfood consumer goods excluding autos jumped 5.6% m/m in May after a 1.5% m/m decline in April. Exports of foods, feeds and beverages increased 0.7% m/m, their third consecutive monthly gain. Auto exports slumped 4.7% m/m, their fifth monthly decline in the past seven months. Capital goods ex auto exports fell 1.3% m/m after having increased 13.9% in March and April. Exports of industrial supplies slipped 0.9%, their first monthly decline since last May.

The May rise in imports was concentrated in foods, feeds, beverages (+5.7% m/m) and industrial supplies (+4.5% m/m). Imports of capital goods ex autos slumped 2.0% m/m and auto imports declined 0.6% m/m. Nonfood consumer goods imports ex autos were little changed in May (+0.1% 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 $) May Apr Mar May Y/Y 2020 2019 2018
U.S. Trade Balance ($ bil.) -88.11 -85.73 -91.92 -75.95 (5/20) -911.06 -850.92 -870.36
Exports (% Chg) -0.3 1.1 10.1 58.6 -13.3 -1.4 7.7
Imports (% Chg) 0.8 -1.9 7.7 39.2 -6.3 -1.7 8.4

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

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