April International Trade in Goods and Services

Our trade gap with other nations widened in April according to Bureau of Economic Analysis.  The deficit moved from a revised $37.1 billion (originally $38.8 billion) to $40.3 billion.  This increased shortfall was a result of imports growing faster than exports.

Comfort can be found in the fact that trade activity picked up on both sides of the ledger.  Exports rose by $2.2 billion over March while imports ticked up some $5.4 billion.  Looking deeper, we see the primary driver increasing our deficit was the difference in non-petroleum goods imports versus exports. This growing chasm may speak to the relative strength of the U.S. economy versus the rest of the world.  In particular, American firms increased their imports of consumer goods.   Further proof can be seen as our petroleum gap improved yet again, dropping from $20.5 billion to $19.7 billion as America’s reliance on foreign oil continues to diminish.

In the short-run the take away is that both imports and exports have improved.  The wider gap will subtract more from the next quarterly Gross Domestic Product tally, but it is encouraging to see both the U.S. and foreign economies demand more from each other.  With businesses upping their purchases of consumer goods made abroad, local firms may be anticipating added demand from U.S. consumers.  Atlas hopes the presumption is correct because many good things can result within an economy when the largest segment has a growth spurt.  (by C. Cox)