A quick recap to the trade data released today paints a relatively negative picture of global trade. The unadjusted three month rolling average value of exports and imports decelerated. Many care about the trade balance which grew as exports shrunk more than imports.
Import goods growth has positive implications historically to the economy – and the seasonally adjusted goods and services imports were reported downmonth-over-month. Econintersect analysis shows unadjusted goods (not including services) growth deceleration of 1.8 % month-over-month (unadjusted data). The rate of growth 3 month trend is decelerating.
Exports of goods were reported down, and Econintersect analysis shows unadjusted goods exports growth deceleration of (not including services) 4.3 % month-over month. The rate of growth 3 month trend is decelerating and in contraction.
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 exports was due to industrial supplies and materials. Import decrease was due to industrial supplies and materials.
The market expected (from Bloomberg) a trade deficit of $-44.0 B to $-39.0 billion (consensus $-40.6 billion deficit) and the seasonally adjusted headlinedeficit from US Census came in at a deficit of $43.9 billion.
It should be noted that oil imports were down — million barrels from last month, and down — million barrels from one year ago [this section not updated as the US Census database is not functioning].
The data in this series is noisy, and it is better to use the rolling averages to make sense of the data trends.
The headline data is seasonally but not inflation adjusted. Econintersect analysis is based on the unadjusted data, removes services (as little historical information exists to correlate the data to economic activity), and inflation adjusts. Further, there is some question whether this services portion of export/import data is valid in real time because of data gathering concerns. Backing out services from import and exports shows graphically as follows:
Leave A Comment