A quick recap to the trade data released today paints a mixed picture. The unadjusted three month rolling average value of exports decelerated month-over-month – but imports accelerated. Many care about the trade balance (which decreased marginally relative to last month), and the trade balance grew.
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 acceleration of 2.5% month-over-month (unadjusted data). The rate of growth 3 month trend is accelerating.
Exports of goods were reported down, but Econintersect analysis shows unadjusted goods exports growth deceleration of (not including services) 3.9 % month-over month. The rate of growth 3 month trend is decelerating.
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 decrease in seasonally adjusted exports was generally across the board except for consumer and capital goods which increased. Import increase was due to consumer and capital goods.
The market expected (from Bloomberg) a trade deficit of $-50.2 B to $-41.0 billion (consensus $-48.6 billion deficit) and the seasonally adjusted headline deficit from US Census came in at a deficit of $48.3 billion.
It should be noted that oil imports were down 17 million barrels from last month, and up 4 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.
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:
