USA: signs of recession from the trade balance
There is a very important sign that a severe recession is coming, and it is a value that, at first reading, might even appear positive.
The US trade deficit narrowed in November much more than market expectations. According to the BEA, November's trade deficit narrowed to $61.5 billion from $77.8 billion the previous month, falling below the median estimate of $63.0 billion (and narrowly missing the high of the range between 61.3 and 80.5 billion dollars indicated by 42 economists).
Surprisingly, the 20% decline in the deficit in one month was the largest, on a percentage basis, since the global financial crisis. A really bad sign!
It would have been good economic news if the decline in the deficit had been the result of a surge in exports. Instead this slump was not driven by increased exports but rather by reduced imports – a telltale sign of an economic slowdown – with consumer goods, industrial supplies, capital goods and automobiles all contributing to the decline, according to the US Bureau of Economic Analysis. To illustrate, while exports fell 2% in November to $251.9 billion from $257.0 billion in October, imports fell an impressive 6.4% in November to $313.4 billion from $334.8 billion in October.
The decline in goods imports included consumer goods ($8.8 billion), industrial supplies and materials ($3.7 billion), automotive vehicles, parts and engines ($3.3 billion). dollars) and capital goods ($3.0 billion).
The decline in services imports is due to decreases in transportation ($0.7 billion) and travel ($0.4 billion). An increase in intellectual property use charges ($0.2 billion) partially offset the decreases.
So the economy which until yesterday was the locomotive of the world with its own imports, is now marking time. Someone will have to start worrying.
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The article USA: signs of recession from the trade balance comes from Scenari Economics .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/usa-segni-di-recessione-dalla-bilancia-commerciale/ on Mon, 09 Jan 2023 08:00:16 +0000.