US Trade Deficit Surged to 9-month High in November

Merchandise trade gap with China narrowed to $28.4 billion from $28.9 billion

Data released by the US Department of Commerce on Friday, January 06th, 2017, showed that the US trade gap increased by $2.9 billion to $45.2 billion in November 2016, from a downwardly revised $42.4 billion in October 2016 and above market expectations of a $42.5 billion shortfall. It was the widest trade deficit since February 2016. Exports fell 0.2% due to lower shipments of civilian aircraft. In contrast, imports rose 1.1% to the highest level in 15 months, driven by crude oil purchases. The goods deficit widened by $3.4 billion to $66.6 billion and the services surplus rose by $0.5 billion to $21.4 billion during the month.u1

Year-to-date, the goods and services deficit decreased $4.9 billion, or 1.1%, from the same period in 2015. Exports decreased $56.6 billion or 2.7%, while imports decreased $61.4 billion or 2.4%.

Total exports of goods and services declined 0.2% to $186.33 billion in November 2016, as sales of goods decreased $0.7 billion to $122.4 billion. Capital goods decreased $1.8 billion to their lowest level since September 2011; civilian aircraft declined $1.3 billion while industrial supplies and materials increased $1.5 billion. Exports of services increased $0.3 billion to $63.5 billion, with financial services rising $0.2 billion and travel inching up $0.1 billion.

During November 2016, total imports rose 1.1% to $231.0 billion, the highest level since August 2015. Imports of goods increased $2.7 billion to $189 billion: industrial supplies and materials increased $2.2 billion and crude oil went up $0.9 billion. Imports of services fell $0.3 billion to $42.1 billion, while transport decreased $0.4 billion and travel decreased $0.2 billion.

A jump in soybean shipments that boosted exports in Q3 FY16 is in the process of unwinding. Soybean exports declined to $1.9 billion in November 2016 from $2.2 billion in the previous month. Trade and inventories are two of the most volatile components in GDP calculations.u2

The report also showed the merchandise trade gap with China, the world’s second-biggest economy, narrowed to a seasonally adjusted $28.4 billion from $28.9 billion. The deficit with the European Union increased $0.9 billion to $13.8 billion in November 2016, while exports decreased $1.3 billion to $21.0 billion and imports decreased $0.4 billion to $34.8 billion.

The remaining US trade deficits were running with countries in the following order: Japan ($5.7 billion), Mexico ($5.7 billion), Germany ($5.3 billion), Canada ($3.2 billion), Italy ($2.2 billion), South Korea ($2.2 billion), OPEC ($1.9 billion), India ($1.8 billion), Taiwan ($1.3 billion), France ($1.3 billion) and Saudi Arabia ($0.2 billion).

Three-month moving averages of goods and services

The average goods and services deficit increased $1.5 billion to $41.3 billion for the three months ended November 2016. The average exports of goods and services decreased $0.7 billion to $187.3 billion during the three-month period, while the average imports of goods and services increased $0.8 billion to $228.6 billion.u3

On a Y-o-Y basis, the average goods and services deficit decreased less than $0.1 billion from the three months ended November 2015. On the other hand, the average exports of goods and services increased $1.7 billion from November 2015, while the average imports of goods and services increased $1.7 billion.

Be the first to comment

Leave a Reply

Your email address will not be published.


*