US Trade Gap Shrinks to $41.8b
World Economy

US Trade Gap Shrinks to $41.8b

The US trade deficit fell to $41.8 billion in January from December as imports declined more than exports, said the Commerce Department.
The trade gap narrowed from a revised December reading of $45.6 billion, previously estimated at $46.6 billion. The January number was slightly less than analysts expected, Reuters reported.
Imports of goods and services fell 3.9 per cent to $231.2 billion, mainly due to a fall in imported goods led by industrial supplies and consumer goods.
Petroleum imports fell as oil prices drop and the US pumps out high levels of crude, boosted by shale-oil and hydraulic fracturing production.
Exports declined 2.9 percent to $189.4 billion, reflecting a slow global economy in recent months.
Goods exports dropped, particularly exports of industrial supplies, while the decline in exports of services was led by the transport sector, which includes freight and port services.
A months-long West Coast port slowdown over a contract dispute had severely backed up cargo in January. The dispute was settled in late February, but the backlog was expected to take some time to work through.
“The strong US dollar and low oil prices should keep a lid on the US trade deficit by holding down the value of nominal imports. A stronger US economy and cheaper imports will boost import growth,” said Kyle Hillman of Moody’s Analytics.
Stronger US demand should help stimulate economic activity in other countries, especially in Europe and Asia, providing support for faster global growth this year and in 2016, the analyst said.

 Little Change
The January data showed little change in the overall US foreign trade gap. The three-month moving average ending in January slipped slightly to $42.3 billion.
But the politically sensitive trade gap with China increased to $28.6 billion from $28.3 billion in December.
Exports to the world’s second-largest economy, which is undergoing a slowdown, tumbled 22 percent to $9.6 billion, while imports from China dropped 5.8 percent to $38.2 billion.
The goods deficit with Japan also increased to $6.5 billion.
The lackluster trade data coincided with a strong February jobs report yesterday from the Labor Department.
The US economy added 295,000 jobs in February despite some severe weather disruptions and mounting layoffs in the oil industry.
The better-than-expected jobs growth pushed the unemployment rate down to 5.5 percent, from 5.7 percent previously, the lowest level since May 2008.
“The economy won’t get help from trade this year, but consumers should more than carry their weight, especially if job growth remains this strong,” said BMO Capital Markets senior economist Sal Guatieri.
The US economy expanded at a breakneck annual pace of 4.8 percent in last year’s spring and summer, only to slow to a tepid 2.2 percent rate in the final three months of 2014. Many economists estimate that growth is picking up slightly in the current quarter to an annual rate of 2.5 percent to nearly 3 percent.
Still, economists remain bullish about hiring despite the slowdown in growth.

Short URL : http://goo.gl/0TIGep

You can also read ...

Close to 40% of digital transformation initiatives will be supported by AI capabilities.
The digital economy in Asia-Pacific, or APAC, is expected to...
An electronic stock indicator of a securities firm in Tokyo.
As investors come to terms with the impending end of easy...
Most economists would agree that Italy needs faster economic growth if it is to resolve its public debt  and banking-sector problems in an orderly manner.
Italy’s economy is growing again, but it’s still the worst...
Maersk is expanding its competitive universe to include different types of companies.
The world’s largest container company will start looking for...
Lloyds Profits Miss Forecasts
Lloyds Banking Group PLC raised its 2017 dividend by 20% and...
CBs May Top Inflation Targets
Not only will central banks meet their inflation targets, they...
Pak Current Account Gap Widens
Pakistan’s current account deficit widened 28.74% on a month-...
NZ Says Pacific Trade Deal Will Boost GDP
New Zealand estimates a Pacific trade deal would boost its...