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Economy in Brief

U.S. Trade Deficit Narrows Yet Again
by Carol Stone, CBE  August 4, 2017

The U.S. trade deficit in goods and services was $43.6 billion in June after May's $46.4 billion; that earlier figure was revised from $46.5 billion and compares to $43.8 billion in June 2016. The Action Economics Forecast Survey showed expectations for a smaller improvement to $45.5 billion this June. Total exports advanced 1.2% (+5.8% y/y) after a 0.4% rise in May. Imports were 0.2% lower (+4.6% y/y) in June after edging down 0.1% in May.

Exports of goods rose 1.5% in June (+6.9% y/y), after increasing 0.1% in May. Gains came in most end-use categories, especially food, feed & beverages 5.9% (9.9% y/y), "other" 3.9% (3.3% y/y) and autos 2.9% (10.0% y/y). Only nonauto consumer goods fell, those by 1.9% (+2.1% y/y).

Services exports rose 1.0% (+3.9% y/y). For categories ranked by dollar amount, travel by foreign tourists in the U.S., $18.3 billion in June, increased 1.8% (+7.6% y/y) and revenue from business services, $11.9 billion, was unchanged (+0.5% y/y), while charges for the use of intellectual property, $10.2 billion, eased 0.2% (-2.4% y/y).

On the import side, purchases of goods edged lower 0.2% in June (+4.7% y/y). The decline came in petroleum, which dropped 10.2% (+9.1% y/y), after May's 2.2% increase. The June move resulted as the price of crude petroleum decreased to $44.68/barrel in June from $45.03 in May but was up from $39.38 in June 2016. The quantity of energy-related petroleum product imports actually fell 1.9% from a year ago, while the quantity of crude petroleum imports was up 1.9% from a year ago.

Nonpetroleum goods imports rose 0.7% (4.4% y/y), following May's 0.6% reduction. Among those imports, autos rose 3.5% (5.5% y/y), reversing their May decrease of 2.4%. "Other" goods also rose 3.5% (10.4% y/y) after a 2.9% rise in May. In contrast, nonauto consumer goods fell 1.5% (-1.9% y/y), following May's decline of 2.9%. Foods, feeds & beverages were up 0.6% (+8.3% y/y) and capital goods edged 0.2% higher (8.0% y/y).

Services imports were unchanged in June (+5.3% y/y). Travel, also the largest category of service imports, at $10.9 billion, decreased 0.2% (+7.2% y/y). Transport service imports, $8.4 billion, fell 0.5% (4.6% y/y) and business services imports, $8.1 billion, edged lower by 0.1% (-2.4% y/y). Intellectual property revenues, $4.0 billion, rose 1.0% (14.1% y/y).

By country, the trade deficit with China widened to $32.6 billion from $29.7 billion in June 2016. Exports to China were up 9.9% y/y while imports from there rose 9.7% y/y. The trade deficit with the European Union was $12.5 billion in June, just marginally different from $12.8 billion a year earlier. Exports to the EU fell 0.4% while imports fell 1.3% y/y. The trade deficit with Japan widened to $5.6 billion versus $5.9 billion twelve months earlier. Exports to Japan rose 8.4% y/y and imports were up 1.2% y/y. These country data are not seasonally adjusted.

The international trade data can be found in Haver's USECON database. Detailed figures are available in the USINT database. The expectations figures are from the Action Economics Forecast Survey, which is carried in AS1REPNA.

Foreign Trade in Goods & Services (Current Dollars) Jun May Apr Y/Y 2016 2015 2014
U.S. Trade Deficit $43.6 bil. $46.4 bil. $47.6 bil. $43.8 bil.
(6/16)
$504.8 bil. $500.4 bil. $490.3 bil.
Exports of Goods & Services (% Chg) 1.2 0.4 -0.1 5.8 -2.5 -4.7 3.6
Imports of Goods & Services (% Chg) -0.2 -0.1 0.9 4.6 -1.9 -3.6 4.0
  Petroleum (% Chg) -10.2 2.2 -12.0 9.1 -19.4 -45.5 -9.7
  Nonpetroleum Goods (% Chg) 0.7 -0.6 2.3 4.4 -1.2 2.2 6.5
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