Both exports and imports increased modestly from their April levels. Exports grew 2.4% while imports were up 2.9%.
Here’s a look at both for the past few months:
Exports m/m: 2.4%, pr. -0.7% (Apr), 3.2% (Mar), 0.2% (Feb),
Imports m/m: 2.9%, pr. -0.4% (Apr), 3.1% (Mar), 1.7% (Feb),
The higher imports can be taken as a good sign, in that it was not led by increases in energy prices but instead imports from China. Increased imports and a larger trade deficit for the US usually illustrates a growing economy as consumers spend more on foreign goods. Now, if the rise in imports was led by higher oil prices that would be a different story, but in May, oil prices (and volumes) actually declined (the US bill for crude oil fell to $21.54 billion from $22.69 billion).
While a larger deficit could be a sign that the US consumer is hungry for imports, it does reduce GDP a bit. In the 1st quarter trade subtracted 0.8 percentage points from GDP as imports outweighed exports. The trade gap with China expanded to $22.28 billion in May, the widest level since last October and a 15% gain on the previous month’s bilateral deficit of $19.31 billion.
US exports meanwhile were up 2.4%, rising to a 20-month high of $152.25 billion. The increase was led by close to $2 billion in higher sales of capital goods – boosted by industrial machines and medicinal equipment. Exports of industrial supplies, consumer goods, and autos also helped to boost exports.
While there didn’t seem to be an immediate impact on currency markets following the trade data, it does give some insight into the US economy for May, and with higher exports (good for US manufacturing) and stronger consumer spending, it could imply that the economy was slightly stronger in May than previously thought.
Canada Trade Balance in Deficit on Higher Exports and Imports
The Canadian trade balance showed another month of deficit in May, with the country posting a C$503 million shortfall after a C$330 million gap in April.
Still, the data is better than it appears at first as both exports and imports rose, with the gain in imports (5.7%) outpacing the gain in exports (5.2%).
Exports rose to C$34.5 billion following two months of decline, with automotive products accounting for over half the growth. Export volumes were up 3.9%, and prices grew 1.2%.
Imports rose to C$34.0 billion as all import sectors, excluding agricultural and fishing grew in May. Machinery and equipment, industrial goods and materials as well as other consumer goods led the gain in imports. That’s a sign that businesses and consumers are spending and is a positive sign for the Canadian economy.
Exports to the United States increased 5.5% while imports grew 5.8%, both on the strength of automotive products trade. Exports to countries other than the United States grew 4.4%, led by a 25.2% increase in exports to the European Union.
US Trade Deficit Widens to Highest Since Nov. 2008, Canada in Deficit as Well
Fundamental Updates \ Nick Nasad \ 9:34 AM EDT \ July 13th, 2010The May US trade gap rose to a higher than expected $42.3 billion. That’s the highest deficit since November 2008.
Official Release: PDF
Both exports and imports increased modestly from their April levels. Exports grew 2.4% while imports were up 2.9%.
Here’s a look at both for the past few months:
Exports m/m: 2.4%, pr. -0.7% (Apr), 3.2% (Mar), 0.2% (Feb),
Imports m/m: 2.9%, pr. -0.4% (Apr), 3.1% (Mar), 1.7% (Feb),
The higher imports can be taken as a good sign, in that it was not led by increases in energy prices but instead imports from China. Increased imports and a larger trade deficit for the US usually illustrates a growing economy as consumers spend more on foreign goods. Now, if the rise in imports was led by higher oil prices that would be a different story, but in May, oil prices (and volumes) actually declined (the US bill for crude oil fell to $21.54 billion from $22.69 billion).
While a larger deficit could be a sign that the US consumer is hungry for imports, it does reduce GDP a bit. In the 1st quarter trade subtracted 0.8 percentage points from GDP as imports outweighed exports. The trade gap with China expanded to $22.28 billion in May, the widest level since last October and a 15% gain on the previous month’s bilateral deficit of $19.31 billion.
US exports meanwhile were up 2.4%, rising to a 20-month high of $152.25 billion. The increase was led by close to $2 billion in higher sales of capital goods – boosted by industrial machines and medicinal equipment. Exports of industrial supplies, consumer goods, and autos also helped to boost exports.
While there didn’t seem to be an immediate impact on currency markets following the trade data, it does give some insight into the US economy for May, and with higher exports (good for US manufacturing) and stronger consumer spending, it could imply that the economy was slightly stronger in May than previously thought.
Canada Trade Balance in Deficit on Higher Exports and Imports
The Canadian trade balance showed another month of deficit in May, with the country posting a C$503 million shortfall after a C$330 million gap in April.
Still, the data is better than it appears at first as both exports and imports rose, with the gain in imports (5.7%) outpacing the gain in exports (5.2%).
Exports rose to C$34.5 billion following two months of decline, with automotive products accounting for over half the growth. Export volumes were up 3.9%, and prices grew 1.2%.
Imports rose to C$34.0 billion as all import sectors, excluding agricultural and fishing grew in May. Machinery and equipment, industrial goods and materials as well as other consumer goods led the gain in imports. That’s a sign that businesses and consumers are spending and is a positive sign for the Canadian economy.
Exports to the United States increased 5.5% while imports grew 5.8%, both on the strength of automotive products trade. Exports to countries other than the United States grew 4.4%, led by a 25.2% increase in exports to the European Union.