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US-TRADE-DEFICIT-INDICATOR
US trade deficit recedes in November on falling imports
WASHINGTON, Feb 7, 2019 (BSS/AFP) – The US trade deficit in November
receded from a 10-year high in the prior month, as imports fell by more than
exports, according to a Wednesday report that had been delayed by the
government shutdown.
However, the trade gap is more than 10 percent higher for the January-
November period than it was in 2017, despite President Donald Trump’s
aggressive policies that have imposed punitive tariffs on hundreds of
billions of dollars in goods, and sparked retaliation from US trading
partners.
While economists had expected the deficit to subtract from growth in the
final quarter of 2018, the latest data changes the picture.
The deficit in November fell to $49.3 billion from $55.7 billion in
October, the Commerce Department said in the data released that was postponed
more than a month.
That was well below the $54 billion economists had expected, and
attributed in part to falling oil prices.
Imports fell by $7.9 billion due largely to big declines in consumer goods
like cell phones and of industrial supplies like petroleum products.
Exports declined $1.2 billion, due to declines in sales of industrial
supplies and consumer goods, partially offset by a $1 billion jump in
civilian aircraft, the data showed.
Economists say the decline also reflects the retreat from the spike as
businesses rushed to buy product in advance of the steep tariffs imposed on
Chinese goods.
“The deficit fell more than expected, consistent with some of the earlier
rise being due to accelerated imports ahead of threatened tariffs,” Jim
O’Sullivan of High Frequency Economics said in a research note.
He said he no longer saw a drag on growth in the fourth quarter.
Ian Shepherdson of Pantheon Macroeconomics said the impact would be less
than expected.
He said “net trade is still likely to be a drag on Q4 GDP growth. But it
is set to be much smaller than we previously thought, so the chance of a 3
percent-plus GDP number has just risen sharply.”
The deficit in goods trade with China fell to $35.4 billion from $38.2
billion in October, not seasonally adjusted, almost entirely due to the drop
in imports.
Washington and Beijing have exchanged steep tariffs on more than $360
billion in total two-way trade.
BSS/AFP/HR/1050