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Highlights
The trade balance worsened in the latest numbers but the details are encouraging as both exports and non-petroleum imports gained. In March, the U.S. trade gap expanded to $51.8 billion from $45.4 billion in February (originally $46.0 billion). Analysts forecast a deficit of $49.5 billion. Exports rose 2.9 percent after a 0.3 percent increase in February. Imports rebounded a sharp 5.2 percent, following a 2.8 percent drop the month before.
The worsening in the trade gap was led by the non-petroleum goods deficit which ballooned to $38.8 billion from $32.8 billion in February. The petroleum goods gap also grew-to $28.6 billion from $27.6 billion. The services surplus expanded to $15.8 billion from $15.7 billion.
On a not seasonally adjusted basis, the March figures showed surpluses, in billions of dollars, with Hong Kong $3.0 ($3.1 for February), Australia $2.0 ($1.7), and Singapore $0.9 ($0.7) among others. Deficits were recorded, in billions of dollars, with China $21.7 ($19.4), European Union $9.8 ($5.9), OPEC $9.1 ($6.4), Japan $7.1 ($7.0), Mexico $6.1 ($5.8), Germany $5.5 ($3.6), and Canada $3.1 ($2.9) among others.
Goods exports were led by industrial supplies and capital goods excluding autos.
Goods imports surged on rebounds in capital goods excluding autos, consumer goods, and industrial supplies. Autos and the foods, feeds & beverages components also made comebacks.
While the overall trade number is a negative for GDP in the short term, the details indicate that demand is stronger than seen earlier with gains in exports and imports. This suggests that manufacturing may not be taking much of a hit from Europe and also that businesses are betting on growth in consumer demand and business investment.
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