Global| Jun 25 2020U.S. International Trade Deficit Unexpectedly Widened in May
by:Sandy Batten
|in:Economy in Brief
Summary
• Trade deficit widened to $74.3 billion. • A 5.8% drop in exports more than offsets the 1.2% decline in imports. • Imports of industrial supplies and of consumer goods ex autos rose in May. The advance U.S. trade report showed the [...]
• Trade deficit widened to $74.3 billion.
• A 5.8% drop in exports more than offsets the 1.2% decline in imports.
• Imports of industrial supplies and of consumer goods ex autos rose in May.
The advance U.S. trade report showed the goods trade deficit unexpectedly widened to $74.3 billion in May from $70.7 billion in April. The Action Economics Forecast panel had looked for the deficit to narrow to $67.2 billion. The marked widening of the deficit in both April and May points to net exports subtracting 2-3 percentage points from Q2 GDP, which is expected to post the largest quarterly decline in the history of the national accounts (dating back to 1947). Exports fell 5.8% m/m (-36.3% y/y) on top of a 25.1% m/m plunge in April. Imports fell only 1.2% m/m (-26.1% y/y) in May after a 13.6% m/m drop in April. Since February, exports have fallen 34.6% while imports have declined 16.4%.
Exports declined in each major category in May except for consumer goods excluding autos, which rose 6.0% m/m. Automotive vehicle and parts exports fell another 11.1% m/m in May on top of the 65.8% m/m collapse in April. Exports of capital goods declined 2.5% m/m in May following a sharp 23.8% m/m drop in April.
This was the fifth consecutive monthly decline in imports. However, the May decline was more than accounted for by a record 72.6% m/m plunge in imports of automotive vehicles and parts. Excluding this category, the remainder of imports actually rose 1.6% m/m in May with imports of industrial supplies rising 4.7% m/m and imports of consumer goods ex autos increasing 4.1% 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 $) | May | Apr | Mar | May Y/Y | 2019 | 2018 | 2017 |
|---|---|---|---|---|---|---|---|
| U.S. Trade Deficit ($ bil.) | -74.34 | -70.73 | -64.94 | -74.95 (05/19) |
-854.37 | -872.04 | -793.40 |
| Exports (% Chg) | -5.8 | -25.1 | -7.4 | -36.3 | -1.4 | 7.7 | 6.6 |
| Imports (% Chg) | -1.2 | -13.6 | -2.1 | -26.1 | -1.6 | 8.5 | 7.0 |
Note: Current month is based on Advance Trade data; Previous months reflect revised data from International Trade release.
Sandy Batten
AuthorMore in Author Profile »Sandy Batten has more than 30 years of experience analyzing industrial economies and financial markets and a wide range of experience across the financial services sector, government, and academia. Before joining Haver Analytics, Sandy was a Vice President and Senior Economist at Citibank; Senior Credit Market Analyst at CDC Investment Management, Managing Director at Bear Stearns, and Executive Director at JPMorgan. In 2008, Sandy was named the most accurate US forecaster by the National Association for Business Economics. He is a member of the New York Forecasters Club, NABE, and the American Economic Association. Prior to his time in the financial services sector, Sandy was a Research Officer at the Federal Reserve Bank of St. Louis, Senior Staff Economist on the President’s Council of Economic Advisors, Deputy Assistant Secretary for Economic Policy at the US Treasury, and Economist at the International Monetary Fund. Sandy has taught economics at St. Louis University, Denison University, and Muskingun College. He has published numerous peer-reviewed articles in a wide range of academic publications. He has a B.A. in economics from the University of Richmond and a M.A. and Ph.D. in economics from The Ohio State University.
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