The Trade Gap Widens In September November 14, 2013
The U.S. trade gap widened in September, with the deficit climbing sharply to $41.8 billion in the concluding month of the third quarter. That was up from the downwardly revised $38.7 billion deficit recorded in August; originally the August gap had been estimated at $38.8 billion.
Breaking the report down, we find that September's exports came to $188.9 billion, while imports came in at $230.7 billion. In August, exports were $189.3 billion and imports totaled $228.0 billion.
Looking at the recent performances, this overall deficit was the largest since May, when the gap had been $43.7 billion. The latest month for which such internationally configured results are recorded resulted in the fourth month this year in which the deficit had topped the $40 billion mark.
Meanwhile, if we back out any short-term deviations to get the three-month moving average, we find that in September the deficit came to $39.7 billion. That was the largest trade gap tally configured this way since May, when the three-month average had been $40.0 billion.
Overall, the trade gap has decreased from 2012 to 2013. In the year prior to this, the deficit was above $41.6 billion every month except December, going as high as $51.4 billion in January. In 2011, the trade imbalance was above $42.1 billion in every month that year.
It should be noted that the improving trade figures are benefiting the economy, as the nation's gross domestic product is composed of domestic output plus exports minus imports. The worsening of the trade results in September thus will exact a modest toll on GDP growth in the third quarter, which initially had been estimated at 2.8%.
On the whole, however, this report does not change our aggregate outlook, in which we continue to believe that GDP growth in the current quarter will come in at just above 2%.
At the time of this article's writing, the author did not have positions in any of the companies mentioned.