The Census Bureau releases a detailed set of data on international trade based on figures compiled from documents collected by the U.S. Customs and Border Protection. The data are aggregated into approximately 140 export and 140 import end-use categories which are then used as the basis for computing the seasonal and trading-day adjusted data. These data are also used by the Bureau of Economic Analysis for use in the NIPAs and in the international transactions accounts (balance of payments accounts).
Imports indicate demand for foreign goods and services here in the U.S. Exports show the demand for U.S. goods in countries overseas. This report gives a breakdown of U.S. trade with major countries as well, so it can be instructive for investors who are interested in diversifying globally. For example, a trend of accelerating exports to a particular country might signal economic strength and investment opportunities in that country. It is important to examine trends for exports and imports separately because they can deviate significantly since the value of the dollar versus various foreign currencies does not always move in tandem.
In September, the Census Bureau reported July exports of $198.0 billion and imports of $238.6 billion with a trade deficit of $40.5 billion, virtually unchanged from $40.8 billion in June. The goods deficit in July decreased slightly to $60.2 billion, and the services surplus was unchanged at $19.6 billion. Based on a three-month moving average, the overall trade deficit fell in July to $41.6 billion though this is well above the figure at the beginning of the year which was just $37.5 billion. Exports continue to rise as they have been for the past 30 months, but imports have grown rather dramatically in 2014 on a three-month moving average basis. Even so, as the chart shows, the United States continues to run a consistent trade deficit, about a third of which is due to petroleum imports.
The United States has a trade deficit with every region of the world save for Latin America and Africa, and in both of those cases the surplus is modest. Year to date, China accounts for about 45 percent of the overall deficit at just over $186 billion, and the OPEC countries account for about 9.4 percent of the deficit or $38.8 billion. At a detail level, the United States has a negative trade balance in nearly every product category save for agricultural and food products, minerals, fabrics and scrap, while maintaining significant positive balances in service categories and tourism. The continuing trade deficit will continue to put pressure on the dollar over time that cannot be masked by central banking policies. Firms will continue to be encouraged to keep foreign receipts abroad even without the negative effects of the corporate tax code.
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