A quick recap to the trade data released today shows a mixed picture (see analyst opinion below). Many care about the trade balance which degraded from last month.

Analyst Opinion of Trade Data

Trade was a mixed bag – with imports growing (good sign for the USA economy) but exports slowing (bad sign for global economy). There was insignificant backward revision. In any event, export trends seem to be generally improving whilst imports are jumping around and are difficult to accurately trend. No data point gives you a sense that international trade is on a rebound.

  • Import goods growth has positive implications historically to the economy – and the seasonally adjusted goods and services imports were reported up month-over-month. Econintersect analysis shows unadjusted goods (not including services) growth accelerated 1.2 % month-over-month (unadjusted data) – down 1.7 % year-over-year (down 1.5 % year-over-year inflation adjusted). The rate of growth 3 month trend is flat (rate of change of growth is zero).
  • Exports of goods were reported down, and Econintersect analysis shows unadjusted goods exports growth deceleration of (not including services) 1.2 % month-over month – down 1.3 % year-over-year (down 0.2 % year-over-year inflation adjusted). The rate of growth 3 month trend is accelerating.
  • Inflation Adjusted But Not Seasonally Adjusted Year-over-Year 3 Month Rolling Average – Goods Export (blue line) and Goods Import Excluding Oil (red line)

    z trade2.PNG

  • The decline in seasonally adjusted (but not inflation adjusted) exports was attributed to food and industrial supply exports. Import decline was due to consumer goods.
  • The market expected (from Bloomberg) a trade balance of $-44.0 B to $-39.0 B (consensus $42.0 billion deficit) and the seasonally adjusted headline deficit from US Census came in at $42.6 billion.
  • It should be noted that oil imports were down 9 million barrels from last month, and down 20 million barrels from one year ago.
  • The data in this series is noisy, and it is better to use the rolling averages to make sense of the data trends.
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