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The US trade deficit in June was $55.2 billion down from the prior month's $55.3 billion. The China and US trade deficit rose to a five month high to -$30.20 B from $30.10 billion prior.Ironically a day after President Donald Trump threatened to ratchet up tariffs 10% on another $300 billion of additional imports from China.

US Trade June 2019

The great irony of this trade war is the fallout is real and justifiable to all sides of politics, that tells you more about politics than anything. We have seen global PMI's collapse and growth collapse as countries turn inward. The second-quarter trade gap subtracted 0.65 percentage point from the annualized growth pace of gross domestic product during the period. We get the long game, but this has been well over a year and America’s merchandise trade deficit with China widened in June to a five-month high, government figures showed Friday.

Ironically a day after President Donald Trump threatened to ratchet up tariffs 10% on another $300 billion of additional imports from China. Now there are two arguments in response, see we need a trade war to bring that down or gee are these tariffs working in ficing the problem. The answer probably lies in between. The strong US dollar negates much of the price affect, there lies a big problem for the US here and probably why POTUS is so irate at the US interest rate differential supporting the US dollar.

Highlights

  • Exports -2.1%
  • Imports -.1.7%
  • Goods deficit $75.1B v Prior $75.9B
  • Services surplus $20.0 v Prior $20.6B
  • US-China deficit $30.2 v Prior 30.1B
  • US-OPEC $300m deficit

After adjusting for inflation the goods trade deficit narrowed to $86.1 billion from $86.4 billion in the prior month. The real petroleum gap narrowed to an all-time low of $5.7 billion as inflation-adjusted petroleum exports reached a record high of $23.3 billion.

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Exports and imports of goods account for about three-fourths of America’s total trade; the U.S. typically runs a deficit in merchandise trade and a surplus in services.

China

The gap with China is at a seasonally adjusted $30.2 billion after $30.1 billion a month earlier, according to the Commerce Department. Noticably the value of American exports to China declined more than imports.

The new tariff levies will be imposed beginning Sept. 1, Trump said in a tweet Thursday that broke a tentative trade cease-fire between the world’s two biggest economies. The 25% tariff already imposed on $250 billion in Chinese goods will remain in place, he said.

Treasury Secretary Steven Mnuchin and U.S. Trade Representative Robert Lighthizer returned from talks with Chinese counterparts in Shanghai this week without reporting much progress. The sides both said they’d meet again in early September in Washington for the next round of talks.

Negotiations have been at an impasse since May after the U.S. said the Chinese reneged on provisions of a tentative deal.

So far this year, the U.S. merchandise deficit with China has narrowed to a seasonally adjusted $179.8 billion, compared with $200.4 billion in the same six months of 2018.

U.S. exports to China are down 18.1% this year, while imports have fallen 12.2%.

Federal Reserve Chairman Jerome Powell this week cited trade tensions with China as one of the biggest risks to an otherwise resilient U.S. economy.

The December 2018 gap was a 10-year high and wider than the median estimate of economists. The merchandise-trade deficit with China, which has been the focus of President Trump’s trade war hit a record $419.2 billion in 2018 

Balance of Trade in the United States averaged -14648.09 USD Million from 1950 until 2019, reaching an all time high of 1946 USD Million in June of 1975 and a record low of -67823 USD Million in August of 2006.

Trade Report Breakdown

  • June exports were $206.3 billion, $4.4 billion less than May exports.
  • June imports were $261.5 billion, $4.6 billion less than May imports.
  • The June decrease in the goods and services deficit reflected a decrease in the goods deficit of $0.8 billion to $75.1 billion and a decrease in the services surplus of $0.6 billion to $20.0 billion.

Year-to-date, the goods and services deficit increased $23.2 billion, or 7.9 percent, from the same period in 2018.

  • Exports increased $0.5 billion or less than 0.1 percent.
  • Imports increased $23.8 billion or 1.5 percent.

Three-Month Moving Averages

  • The average goods and services deficit increased $1.1 billion to $53.9 billion for the three months ending in June. 
  • Average exports decreased $1.7 billion to $207.8 billion in June.
  • Average imports decreased $0.6 billion to $261.7 billion in June.
  • Year-over-year, the average goods and services deficit increased $7.2 billion from the three months ending in June 2018.

Exports

  • Exports of goods decreased $3.9 billion to $137.1 billion in June.
  • Exports of goods on a Census basis decreased $3.8 billion.

Consumer goods decreased $1.9 billion.

  • o Gem diamonds decreased $0.8 billion.
  • o Pharmaceutical preparations decreased $0.5 billion.
  • o Jewelry decreased $0.4 billion.

Capital goods decreased $1.2 billion.

  • o Computer accessories decreased $0.4 billion.
  • o Other industrial machinery decreased $0.2 billion.
  • o Telecommunications equipment decreased $0.2 billion.
  • • Automotive vehicles, parts, and engines decreased $0.5 billion.
  • o Passenger cars decreased $0.4 billion.

Net balance of payments adjustments decreased $0.1 billion.

Exports of services decreased $0.5 billion to $69.2 billion in June.

  • • Travel (for all purposes including education) decreased $0.4 billion.
  • • Transport decreased $0.1 billion.

Imports

  • Imports of goods decreased $4.7 billion to $212.3 billion in June.
  • Imports of goods on a Census basis decreased $4.4 billion.

Industrial supplies and materials decreased $3.2 billion.

  • o Crude oil decreased $1.4 billion.
  • o Other petroleum products decreased $1.0 billion.
  • o Fuel oil decreased $0.3 billion.

Consumer goods decreased $0.9 billion.

  • o Cell phones and other household goods decreased $1.4 billion.
  • o Pharmaceutical preparations increased $0.6 billion.

Net balance of payments adjustments decreased $0.2 billion.

Imports of services increased $0.1 billion to $49.2 billion in June, reflecting small (less than $50 million) changes in all major service categories.

Real Goods in 2012 Dollars – Census Basis

Real goods deficit decreased $0.3 billion to $86.1 billion in June.

  • • Real exports of goods decreased $2.8 billion to $148.1 billion.
  • • Real imports of goods decreased $3.1 billion to $234.2 billion.

Revisions

Revisions to May exports • Exports of goods were revised up $0.2 billion. • Exports of services were revised down $0.1 billion. Revisions to May imports • Imports of goods were revised down less than $0.1 billion. • Imports of services were revised down $0.1 billion

Goods by Selected Countries and Areas:

The June figures show surpluses, in billions of dollars, with South and Central America ($4.8), Hong Kong ($2.3), Brazil ($1.3), and United Kingdom ($0.1).

Deficits were recorded, in billions of dollars, with China ($30.2), European Union ($15.9), Mexico ($9.2), Japan ($6.2), Germany ($5.2), Canada ($3.3), Italy ($2.6), France ($1.9), Taiwan ($1.7), India ($1.6), South Korea ($1.4), OPEC ($0.3), Saudi Arabia ($0.3), and Singapore ($0.1).

• The deficit with the European Union decreased $1.0 billion to $15.9 billion in June. Exports decreased $0.5 billion to $26.7 billion and imports decreased $1.5 billion to $42.7 billion.

• The surplus with Brazil increased $0.8 billion to $1.3 billion in June. Exports increased $0.3 billion to $3.9 billion and imports decreased $0.5 billion to $2.6 billion.

• The balance with Singapore shifted from a surplus of $0.6 billion to a deficit of $0.1 billion in June. Exports decreased $0.2 billion to $2.5 billion and imports increased $0.4 billion to $2.6 billion.

All statistics referenced are seasonally adjusted; statistics are on a balance of payments basis unless otherwise specified. Additional statistics, including not seasonally adjusted statistics and details for goods

Annual Summary for 2018 Exports, Imports, and Balance

For 2018, the goods and services deficit was $621.0 billion, up $68.8 billion from $552.3 billion in 2017. Exports were $2,500.0 billion in 2018, up $148.9 billion from 2017. Imports were $3,121.0 billion, up $217.7 billion from 2017.

The 2018 increase in the goods and services deficit reflected an increase in the goods deficit of $83.8 billion, or 10.4 percent, to $891.3 billion and an increase in the services surplus of $15.0 billion, or 5.9 percent, to $270.2 billion. As a percentage of U.S. gross domestic product, the goods and services deficit was 3.0 percent in 2018, up from 2.8 percent in 2017.

Exports 

Exports of goods increased $118.5 billion to $1,671.8 billion in 2018. Exports of goods on a Census basis increased $117.8 billion.

  • Industrial supplies and materials increased $74.2 billion. Crude oil increased $24.6 billion. Other petroleum products increased $14.4 billion. Capital goods increased $28.7 billion. Civilian aircraft engines increased $7.9 billion. Other industrial machines increased $2.9 billion. Computer accessories increased $2.5 billion.

Net balance of payments adjustments increased $0.6 billion.

Exports of services increased $30.4 billion to $828.1 billion in 2018.

  • Other business services, which includes research and development services; professional and management services; and technical, trade-related, and other services, increased $8.5 billion. Financial services increased $4.6 billion. Travel (for all purposes including education) increased $4.3 billion.

Imports

Imports of goods increased $202.2 billion to $2,563.1 billion in 2018. Imports of goods on a Census basis increased $200.8 billion.

  • Industrial supplies and materials increased $68.4 billion. Crude oil increased $24.6 billion. Capital goods increased $52.7 billion. Computers increased $8.7 billion. Electric apparatus increased $5.4 billion. Computer accessories increased $5.4 billion. Other industrial machines increased $5.1 billion. Consumer goods increased $46.1 billion. Pharmaceutical preparations increased $23.7 billion. Net balance of payments adjustments increased $1.4 billion. Imports of services increased $15.4 billion to $557.9 billion in 2018. Travel (for all purposes including education) increased $10.1 billion. Other business services increased $7.0 billion. Transport increased $6.5 billion. Insurance services decreased $13.0 billion.

Goods by Selected Countries and Areas – Census Basis

The 2018 figures show surpluses, in billions of dollars, with South and Central America ($41.5), Hong Kong ($31.1), Netherlands ($24.8), Australia ($15.2), and Belgium ($14.2).

Deficits were recorded, in billions of dollars, with China ($419.2), European Union ($169.3), Mexico ($81.5), Germany ($68.3), Japan ($67.6), Ireland ($46.8), Italy ($31.6), Malaysia ($26.5), India ($21.3), OPEC ($21.2), Canada ($19.8), Thailand ($19.3), Switzerland ($18.9), South Korea ($17.9), France ($16.2), Taiwan ($15.5), Russia ($14.1), Indonesia ($12.6), and Saudi Arabia ($10.5).

The deficit with China increased $43.6 billion to $419.2 billion in 2018. Exports decreased $9.6 billion to $120.3 billion and imports increased $34.0 billion to $539.5 billion.

The deficit with the European Union increased $17.9 billion to $169.3 billion in 2018. Exports increased $35.4 billion to $318.6 billion and imports increased $53.3 billion to $487.9 billion.

The surplus with South and Central America increased $7.3 billion to $41.5 billion in 2018. Exports increased $13.6 billion to $163.8 billion and imports increased $6.3 billion to $122.3 billion.

* * * All statistics referenced are seasonally adjusted; statistics are on a balance of payments basis unless otherwise specified. Additional statistics, including not seasonally adjusted statistics and details for goods on a Census basis, are available in exhibits 1-20b of this release. For information on data sources, definitions, and revision procedures, see the explanatory notes in this release.

Source: bea

From The Traders Community News Desk

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